BOT says 2015 inflation range of 1-3% is still appropriate

General

The Bank of Thailand said that the inflation framework for 2025 at 1-3% is still appropriate. It sees the Ministry of Finance giving the question that there must be measures to support inflation close to the 2% framework, which is still within the framework. It pointed out that the proportion of household debt has slowed down since Covid. It confirmed that the postponement of the election of the chairman of the Bank of Thailand board will not affect the work. Mr. Piti Disyatat, Deputy Governor for Financial Stability, Bank of Thailand, said at the Monetary Policy Forum that the inflation framework for 2025 at 1-3% is still an appropriate framework. He believes that all parties share the same goal of wanting to see an economy with potential and increased investment. In order to achieve the goal, the Monetary Policy Committee (MPC) is responsible for overseeing the economic situation to be appropriately conducive, using a combination of tools, including taking care of interest rates, taking care of the curren cy to prevent excessive volatility, and measures to take care of debt resolution. However, if the economy is going to recover, inflation will increase but still be within the target range, which should be the case. It should not be delayed until inflation is low, which is a good thing. He stated that the baht is not the ultimate goal, but is part of the goal of economic expansion, which the BOT already takes care of the currency to take care of any volatility that may occur. For the next MPC meeting, we will have to look at financial developments to be in line with the economic situation. In the case of Mr. Pichai Chunhavajira, Minister of Finance, who asked the BOT to provide additional measures to support inflation to be close to the target range of 2%, he sees that it is still within the target range. He also stated that the inflation target framework is to make the economy grow with potential, which he sees as conducive to economic expansion. Mr. Sakkapop Panyanukul, Assistant Governor, Monetary Policy Group, Bank of Thailand, said that the risk to long-term financial stability has decreased amid the context of slower credit growth, which is in line with the assessment. Part of this is due to lower demand for credit and debtor repayments after the government's measures during the COVID-19 outbreak. Financial institutions are more cautious in granting loans, especially in some groups, such as vulnerable retail groups and SCB, whose income has recovered slowly. This is consistent with the increasing credit risk of debtors and the decrease in business loans due to structural factors, such as the automotive business and businesses that are under additional pressure from competition from China. However, it is believed that the interest rate cut is not the main factor that will cause the loan to decrease. As for the election of the chairman of the BOT board, which has been postponed indefinitely, it was confirmed that it would not affect the work because there are already working groups responsible for each area . Source: Thai News Agency