(Bloomberg) -- Thai Finance Minister Pichai Chunhavajira said the Bank of Thailand will consider cutting interest rates, following a meeting with Governor Sethaput Suthiwartnarueput in Bangkok today.
Lower rates will help ease the burden on borrowers and support funding access, Pichai told reporters on the sidelines of a consumer event run by the Bank of Thailand, arguing that it’s the role of the monetary policy committee to consider reducing borrowing costs. The central bank chief left without comment.
The government has been waging a public campaign to pressure the central bank to reduce borrowing costs, arguing that inflation is below the central bank’s 1% to 3% target, and that the economy needs a boost. Rate cut calls have risen in recent days, with the baht gaining about a tenth in value against the dollar in the past three months is also threatening the export and tourism sectors that comprise the bulk of Southeast Asia’s second-largest economy.
“The central bank’s monetary policy committee will consider key factors in the next rate deliberation,” Pichai says, adding the rate-setting panel “should have reasons” if it decides not to lower the benchmark interest rate.
Fourth-quarter inflation is expected to be around 1%, which is considered low, while annual inflation is expected to miss the target, Pichai says. The Ministry of Finance and Bank of Thailand chiefs will hold talks again later this month to discuss the inflation outlook and next year’s target.
The Bank of Thailand’s next monetary policy meeting is set for Oct. 16, the same day that neighboring Indonesia and the Philippines will meet to discuss rates.
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