Concerns Over Thailand’s High Benchmark Interest Rate

Thailand’s Deputy Finance Minister, Julapun Amornvivat, has expressed concerns about the country’s benchmark interest rate, stating that it is “too high” and negatively impacting the standard of living for the Thai people while weighing down the economy. In an interview with Bloomberg Television in Hong Kong, Julapun urged the central bank to consider easing monetary policy to alleviate the financial burden on the citizens.

Julapun, considered a key adviser to Prime Minister Srettha Thavisin, is echoing calls made by the premier earlier this month for a rate cut. However, the Bank of Thailand has pushed back, asserting that the current interest rate is appropriate. This policy disagreement, which began shortly after Srettha assumed office in August, poses a risk of deepening the slump in the baht and the stock market.

While acknowledging the independence of the Bank of Thailand, the government is concerned about borrowing costs reaching a 10-year high, impeding economic recovery. Julapun emphasised that the central bank will ultimately decide the interest rates, and the government is committed to taking measures to stimulate the economy. The next rate meeting is scheduled for Feb.