Thailand's mega-investment, stronger baht boost capital inflows

BANGKOK, June 28 (TNA) - The Federation of Thai Industries (FTI) says that there have been more capital inflows over the past year, boosted by the government's mega-investment plans and the appreciation of the Thai baht. FTI Chairman Supant Mongkolsuthree told journalists of the information in Bangkok on June 27, acknowledging that the United States' reduced key interest rate has also resulted in more capital flowing into the Thai economy. The FTI chief stated, however, that the private sector views the Thai baht is now too strong, urging the Bank of Thailand (BOT) to handle the situation to make the the Thai currency depreciate and become stable at about 32 baht a US dollar, from about 31 baht against the greenback currently. The FTI chief reasoned that the depreciation of the Thai baht, as proposed by the private sector, should help boost Thai exports and the national economy amid negative impacts from the persistent trade war between the United States and China and the ongoing global economic slowdown. The FTI chief also voiced the private sector's call on the Thai central bank to further cut its key interest rate to propel the national economic growth in the second half of this year. The BOT's Monetary Policy Committee (MPC) resolved at its latest meeting earlier this week to keep Thailand's key interest rate intact at 1.75 per cent annually and adjusted downward the projection of the country's gross domestic product (GDP) growth in 2019 to about 3.3 per cent year-on-year on average. According to the FTI chief, the Joint Standing Committee on Commerce, Industry and Banking (JSCCIB), comprising of FTI, the Board of Trade of Thailand and the Thai Bankers' Association, is likely to also adjust downward its projection of the country's GDP and export growth this year at its upcoming meeting on July 10 due mainly to the external risk factors. The FTI chief, meanwhile, called for a quick formation of the new Thai coalition government, urging, as well, the new administration to, once taking office, speed up implementing measures to boost major farm produce prices and people's purchasing power, along with keeping promoting the domestic tourism, which will stimulate the national economy during the remaining period of this year. (TNA)