Bank of Thailand says economic stability more important than fixing inflation

[webfact]

 

By Panithan Onthaworn

 

The Bank of Thailand (BoT) said on Monday it would prioritize economic stability over plans to tackle short-term inflation, as the country’s vital tourism sector is on the path of recovery.

 

“It is not worth slowing the economy in order to reduce inflation,” Piti Disyatat, assistant-governor of the Monetary Policy Group, told an analysts meeting. 

 

Such plans to cope with inflation are increasing interest rates, he said. The Bank will be focusing on the stability of Thailand’s economic growth, yet inflation will remain a concern.

 

Full story: https://www.thaienquirer.com/36367/bank-of-thailand-says-economic-stability-more-important-than-fixing-inflation/

 

-- © Copyright Thai Enquirer 2022-01-11

 

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[RichardColeman]

25 minutes ago, webfact said:

as the country’s vital tourism sector is on the path of recovery.

What the............And these are the best experts at the BOT ? I can only assume that they have been interned in some 100ft deep nuclear bunker, with no access to phones and the internet for the last 14 months.

[stigar]

14 minutes ago, RichardColeman said:

What the............And these are the best experts at the BOT ? I can only assume that they have been interned in some 100ft deep nuclear bunker, with no access to phones and the internet for the last 14 months.

They brag same almost every last topics here.Best this and that...When will hey wake up and realize that thailand is NOT the best...not even near

[daveAustin]

1 hour ago, webfact said:

as the country’s vital tourism sector is on the path of recovery

???????????? What path’s that then?

Forget economic stability, whatever that is at this time, do the right thing and spend some of those locked-away billions of $US reserves, sell a few tons of gold to China and HELP YOUR PEOPLE! You can then lower your bloated currency, attract more foreign investment and help exports. 

[ezzra]

4 hours ago, webfact said:

over plans to tackle short-term inflation

Short terms inflation? can you predict when inflation will end? i don't think so, and as for tourism, this horse was flogged to death and buried long time ago...

Edited January 11, 2022 by ezzra

[BritManToo]

4 hours ago, webfact said:

.......... as the country’s vital tourism sector is on the path of recovery.

It's great they've got their 20% GDP back.

[nausea]

4 hours ago, webfact said:

short-term inflation

A phrase that sounds a lot like Powell's "transitory" inflation to me. Get with the game man, that phrase has been retired, don't you know?

[Pedrogaz]

They are both important but if you don't fix inflation, you won't have economic stability. Did the high inflation of the 80s in Argentina stabilise the economy there? How about Zimbabwe, with 10000% inflation was that a stabilised economy? Would you invest in such an economy?

[Eric Loh]

22 minutes ago, Pedrogaz said:

They are both important but if you don't fix inflation, you won't have economic stability. Did the high inflation of the 80s in Argentina stabilise the economy there? How about Zimbabwe, with 10000% inflation was that a stabilised economy? Would you invest in such an economy?

Agree with you that both are important and your examples are valid. However I think BOT has failed to explain whether inflation is transitory or permanent. It's a delicate monetary decision to rise interest rate to combat inflation when the economy is still very weak and will affect the currency volatility; a bane for economic stability. 

[Cake Monster]

1 hour ago, Pedrogaz said:

They are both important but if you don't fix inflation, you won't have economic stability. Did the high inflation of the 80s in Argentina stabilise the economy there? How about Zimbabwe, with 10000% inflation was that a stabilised economy? Would you invest in such an economy?

Or the stability that has begot Turkey, with its 36 % inflation Rate today.

IMO, right or wrong, many Investors are now looking at Thailand, and the inability to rein in the spiraling Household Debt, which now stands at 100 % of GDP.

A rise of 10 % of GDP in just 2 Quarters, and something which is completely, and utterly unsustainable.

It will be interesting to see how much Debt is now going Toxic in the form of NPL or Special Mention Debt, of which most turns to NPL

[roquefort]

2 hours ago, Eric Loh said:

Agree with you that both are important and your examples are valid. However I think BOT has failed to explain whether inflation is transitory or permanent. It's a delicate monetary decision to rise interest rate to combat inflation when the economy is still very weak and will affect the currency volatility; a bane for economic stability. 

How would the BOT know if inflation is going to be transitory or longer term? (it's never permanent)

Is their crystal ball better than Jay Powell's?

 

It depends on so many factors beyond their control - the price of oil, supply chain issues, labour shortages due to Covid isolation to mention just three. These economists sit in their ivory towers and think they are the masters of the universe. An economy is the result of millions of individual decisions made by millions of individual people and businesses every second. They control nothing.