Finance Minister Kittiratt Na-Ranong said the capital inflow due to the high Thai interest rate will not be beneficial and will, in fact, pose risks to the country’s economy.
He said the Finance Ministry has signalled the Monetary Policy Committee and the BoT Board to “take into consideration an appropriate policy interest rate”.
However, he added, no matter what the decision, the Finance Ministry “can take it”.
The National Economic & Social Development Board (NESDB) said the inflow of foreign capital has contributed to neither investment nor employment and the inflow is short-term only, so the policy interest rate should be reduced.
So far, however, the BoT shows no signs of taking this advice. Virabongsa Ramangkura, chairman of the bank’s board of directors, said that even though there are significant signs of possible bursting bubbles in the financial and property sectors this year, he strongly believes that the BoT should not lower the interest rate.