Thailand's key interest rate maintained at 2.25%

BANGKOK, January 22 (TNA) - The Bank of Thailand (BOT) has maintained its key interest rate at 2.25 per cent annually. BOT Governor Prasarn Triratvorakul, in his capacity as Chairman of the central bank's Monetary Policy Committee (MPC), told journalists on Wednesday that the MPC reached the resolution with the majority vote at its latest meeting earlier in the day because the 2.25 per cent repurchase rate (RP) is considered to still support Thailand's economic recovery. Prasarn explained that the majority of the MPC views ongoing domestic political problems are a short-term risk factor, while the country's strong economic fundamentals can still cope with it, as the national financial stabilisation should significantly support the Thai economic recovery in the future. The BOT chief said, however, that the MPC will keep monitoring the updated situation closely and implement appropriate policies. The BOT chief cautioned, however, that prolonged domestic political disturbance could pose problems to the Thai economy because costs of transport and borrowing would be rising and Thailand would lose its competitiveness. The BOT governor acknowledged that political problems reduced domestic consumption and investment from their anticipated levels last year and the Thai economic growth rate has been revised downwards to less than 3 per cent year-on-year in 2013 consequently, from more than 3 per cent anticipated earlier, and to only 3 per cent year-on-year in 2014, from 4 per cent assessed earlier. The BOT chief pointed out although international investors are selling Thai stocks and bonds, they have not sent any signal that they lose confidence in Thailand's economic fundamentals and they have maintained their investment in the Kingdom, while the Thai baht remains stable despite its depreciation to a certain extent and Thai financial institutes have been functioning well and inflation is running slowly.(TNA)