Thailand's interest rates declining

BANGKOK, June 5 (TNA) - A banking executive says that interest rates in Thailand are declining, following a recent cut in the Bank of Thailand (BOT)'s key interest rate and the country's lower than expected economic growth rate in the first quarter of this year. Vasin Vanichvoranun, Executive Vice President of Kasikorn Bank (KBank), assessed on Wednesday that interest rates in Thailand should be first stable and later decline, as the Thai economy grew by 5.3 per cent in the first quarter of this year, lower than expected. As local commercial banks have not cut their interest rates, after the BOT's Monetary Policy Committee (MPC) reduced the policy interest rate, or the repurchase rate, by 0.25 per cent last week, Vasin pointed out that all banks need to first consider relevant factors carefully, including growing demand for loans, investment by the government and the private sector, fierce competition for deposits, reports on Moody’s Investors Service Inc.'s preparing to downgrade the credit rating of Thailand and the possibility of the US Federal Reserve (FED)'s stopping its quantitative easing measure sooner than scheduled. Vasin acknowledged if Moody’s lowered its credit rating for Thailand, the government and the private sector would face higher costs of borrowing and fund-raising, as other countries would consider Thailand having higher risks in terms of budgetary stability. (TNA)