BOT:Weakening Thai baht is caused by key rate cut

BANGKOK, March 16 (TNA) - Last week's cut in the Bank of Thailand (BOT)'s key interest rate has weakened the Thai currency. BOT Spokesman Chirathep Senivongs Na Ayudhaya told journalists of the information on Monday, pointing out that the reduced repurchase rate has resulted in the value of the Thai baht declining from 32.80 to 32.94 baht a US dollar. The spokesman acknowledged that the lower repurchase rate has also caused the interest rate of 10-year Thai government bonds to have dropped from 2.74 per cent on March 11 to 2.49 per cent, its lowest level in six years. According to the spokesman, Thailand's interest rates are now also the lowest in the region, bringing a good opportunity for investment expansions in the Thai private sector. The spokesman noted that the key interest rate cut was aimed at cushioning confidence of the business sector and the general public, while reducing borrowing costs. The BOT spokesman cautioned that approaching challenges for the Thai economy are the country's ability to enhance its competitiveness and progress in national reform, especially tax restructuring, as monetary policies will ease economic impacts only in the short run and national progress will not sustain without national reform. (TNA)