Thai finance ministry and central bank to discuss inflation target next week
· CNA · JoinBANGKOK : Thailand's government will next week discuss the inflation target and strong baht with the central bank, Finance Minister Pichai Chunhavajira said on Tuesday, as the government pushes for an interest rate cut.
The plan to seek the review, first reported by Reuters, follows months of government pressure on the Bank of Thailand to cut the rate from a decade-high 2.50 per cent, in a bid to boost growth of an economy that has been struggling since the pandemic.
A review of the 1 per cent to 3 per cent inflation target range, which has been in place since 2020, could raise the chance of a rate cut long sought by former premier Srettha Thavisin, who was dismissed from office last month by a court order.
Inflation in August came in at 0.35 per cent.
Southeast Asia's second-largest economy is expected to grow 2.6 per cent this year from an expansion of 1.9 per cent last year, behind regional peers. The government is hoping its raft of stimulus measures could trigger a rebound, including a 450 billion baht ($13.66 billion) handout and raising the daily minimum wage.
Prime Minister Paetongtarn Shinawatra on Tuesday said the government would push for a minimum wage hike to 400 baht ($12) by this year, as it expected to miss its October deadline.
The minimum wage is currently between 330 baht and 370 baht, depending on the region.
The finance ministry will also discuss the baht's rapid appreciation with the central bank.
A Thai business chamber on Monday urged the central bank to take measures to stabilise the baht, the recent strength of which it said was hurting exports and tourism, key drivers of the economy.
The baht was at around 32.9 to the greenback early on Tuesday and has been trading at its strongest level in more than 19 months. It has gained 13 per cent against the dollar since a low in April of 37.17.
($1 = 32.9400 baht)
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