FILE PHOTO: The skyline of central Bangkok and the Chao Phraya river are seen during sunrise in Bangkok April 22, 2015. REUTERS/Athit Perawongmetha

 

By Orathai Sriring

 

BANGKOK (Reuters) - Thailand's financial system has become more vulnerable due to negative shocks from the latest coronavirus outbreak and there remained significant risks to the economy, the central bank's minutes of its last meeting showed on Wednesday.

 

The Southeast Asian country's latest COVID-19 outbreak, its biggest so far, has seen infections more than triple and deaths increase six fold since it started in April, following a year of success in containing earlier outbreaks.

 

On May 5, the monetary policy committee left the policy rate unchanged at a record low of 0.50% for an eighth straight meeting to help support Southeast Asia's second-largest economy amid a third wave of COVID-19 infections..

 

The rate hold was to preserve limited policy room to be used at the most effective time, the minutes said. (https://bit.ly/33T6E2j)

 

The Thai economy would expand at a much lower rate due to more severe impact of the latest outbreak relative to the second wave, the minutes said.

 

The central bank's current 2021 economic growth forecast is 3.0% and it will review that at its next meeting on June 23.

 

"The third wave of outbreak resulted in slower and more uneven economic recovery across sectors," the minutes said.

 

"The financial positions of Thai households had become more fragile as reflected in the elevated debt-to-income ratio, which was relatively high compared with other countries," the minutes said.

 

The committee would continue to monitor developments in foreign exchange markets and capital flows, the minutes said.

 

An acceleration of vaccine procurement and distribution would be key to Thailand's economic recovery, and the government should implement targeted and timely measures to accelerate the recovery, the minutes said.

 

On Tuesday, the cabinet approved a further borrowing of 700 billion baht ($22.3 billion) to ease the outbreak impact as its current 1 trillion baht borrowing is almost used up.

 

($1 = 31.44 baht)

 

(Reporting by Orathai Sriring; Editing by Ed Davies)

 

-- © Copyright Reuters 2021-05-19

 

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Must be fake news.

Banks are doing very well and no NPL on their books.

On May 5, the central bank left its policy rate unchanged at a record low of 0.50% for an eighth straight meeting

 

That won't change upwards for a very long time.

2 minutes ago, AlfHuy said:

Must be fake news.

Banks are doing very well and no NPL on their books.

Your statement shows you didn't click on the link and read the minutes!

Just now, Brierley said:

Your statement shows you didn't click on the link and read the minutes!

Here he goes again. Defending the Thai banking system.

 

Do you work for one of them?

Another victim of this English B117 mutant variant. 

 

A lot of lives lost and a massive financial hit not only in Thailand but around the globe.

1 minute ago, AlfHuy said:

Here he goes again. Defending the Thai banking system.

 

Do you work for one of them?

No. But I do read the reports they put out rather than just the headlines, that way I know what I'm commenting on rather than just guessing!

This is not surprising when you consider that almost every country is having financial issues including the U.S. , UK and Canada.

 

It is going to be a different world for a long time,

4 hours ago, AlfHuy said:

On May 5, the central bank left its policy rate unchanged at a record low of 0.50% for an eighth straight meeting

 

That won't change upwards for a very long time.

Think it might tank if nobody comes on the unquarantined vaccination jollies in July

Interest rates are relative.  What may be record low in Thailand would pass for high in the US and Europe.  And currency traders seek out emerging markets with higher interest rates. Thus, the persistently high Baht.

Edited May 19, 20215 yr by Isaan sailor

What happens when the "killer" variant finally evolves. The one where the chance of survival just plummets. It's a very real possibility given what little we know about the mutations that have evolved this year. 

 

Apart from Covid, what black swans are waiting in the wings, the stuff that will happen anyway?

Social unrest, now amplified with every day of the poor and middle class being squeezed out of tourism earnings, and the ripple effects of that? What happens then?

 

What happens when the neglected road toll, where the critically injured are in the several hundreds a day, can't be patched up because the hospital system is overwhelmed with the variant trashing India and already here, spreading exponentially, not linear, which is terrifying because, the daily figures are about a week behind of where the virus is already spreading, undetected.

 

The coup did the economy and treasury no favours, the military budget has tripled since the coup, and most of it apparrently does not even go into procurement, if the neverending tales of watch collections, and pointless memorial parks etc are true, you think?

 

What happens then?  S**t happens, big time.

Edited May 19, 20215 yr by chalawaan

5 hours ago, webfact said:

"The financial positions of Thai households had become more fragile as reflected in the elevated debt-to-income ratio, which was relatively high compared with other countries," the minutes said.

The crown is slipping, no longer boasting to be the strongest S.E Asian nation.

6 hours ago, webfact said:

An acceleration of vaccine procurement and distribution would be key to Thailand's economic recovery, and the government should implement targeted and timely measures to accelerate the recovery, the minutes said.

 

Thanks for that bombshell, Captain Obvious.

44 minutes ago, hotchilli said:

The crown is slipping, no longer boasting to be the strongest S.E Asian nation.

Things change quickly 

6 hours ago, RobMuir said:

Another victim of this English B117 mutant variant. 

 

A lot of lives lost and a massive financial hit not only in Thailand but around the globe.

The present wave of covid 19 came from Cambodia . B117 variant or not . Illegal entry etc

7 hours ago, webfact said:

the cabinet approved a further borrowing of 700 billion baht ($22.3 billion)

 Where from - China???

1 minute ago, Burma Bill said:

 Where from - China???

The Thai Bond market.