Thailand Maintains Policy Rate At Record Low O.5 Pct

By Linda Khoo Hu LI BANGKOK, Nov 18 (Bernama) -- The Bank of Thailand (BoT) maintained its policy rate at a record low of 0.5 per cent for a fourth straight meeting today due to the fragile road to economic recovery from the COVID-19 pandemic. The BoT’s Monetary Policy Committee (MPC) unanimously voted to maintain the benchmark interest rate to support economic recovery while placing emphasis on more targeted measures. In a statement, MPC secretary Titanun Mallikamas said the committee assessed that despite the recent better-than-expected outturn, the economy would recover slowly and needed support from the continued low policy rate. “Nonetheless, the economic recovery would remain fragile and highly uncertain. “The committee thus voted to maintain the policy rate at this meeting and to preserve the limited policy space in order to act at the appropriate and most effective timing,” he said. Titanun said even though the Thai economy improved more than expected in the third quarter of 2020, the recovery would remain slow and vary significantly among economic sectors. “Overall economic activities were projected to take approximately two years before returning to the pre-COVID-19 pandemic level,” he said. Titanun said the committee also expressed concerns over the rapid appreciation of the baht as it would affect the fragile economic recovery. He said the rapid rise in baht against the US dollar was attributed to risk-on sentiment following the US presidential election outcome and the progress of COVID-19 vaccine development. “Therefore, the committee will closely monitor developments in foreign exchange markets and capital flows, as well as consider the necessity of implementing additional appropriate measures,” he said. He added that BoT will hold a briefing on the baht situation and measures on Friday. Thailand’s economy contracted at a slower pace in the third quarter (Q3) of this year as a result of improvements in total exports of goods and services, private investment and private final consumption expenditure. Data released Wednesday by state planning agency National Economic and Social Development Council (NESDC) showed that the country’s gross domestic product (GDP) shrank by 6.4 per cent, recovering from a fall of 12.1 in Q2 -- the sharpest fall in more than two decades. -- BERNAMA