The country’s Monetary Policy Committee (MPC), one of the main committees of the Bank of Thailand, decided today (Wednesday), by a vote of 6 to 1, to increase the policy rate by 0.25%, to 0.75%, with immediate effect.

 

MPC Secretary Piti Disyatat said that they have assessed the overall economic situation and believe that the economy has a tendency to rebound and will return to a pre-COVID-19 condition by the end of this year. There is, therefore, no need to ease monetary policy further to accommodate the pandemic.

 

He disclosed that one of the committee members suggested that the rate should be increased by 0.5%, to reduce the risk of having to make a further adjustment in the near future.

 

Full Story: https://www.thaipbsworld.com/thailands-monetary-policy-committee-increases-policy-rate-to-0-75-with-immediate-effect/

 

-- © Copyright Thai PBS 2022-08-10

 

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Having read the full report, I dont think I have ever heard so much Tosh in one Statement.

SME and Households more able to service their Debts ????

Economy stable but it varies across different sectors ????

Inflation to remain at the projected number until the Year end ????

The bottom line is that the MPC cannot raise the Policy Rate any higher due to the massive amount of borrowing  at low rates.

Debts at these rates are already climbing, so any increase in Interest Rates will throw Thousands more into NPL, which is something the Government does not want, as Credit Ratings will be affected, and the knock on from that is higher borrowing and Capital, plus Stock outflows.