Central bank to re-estimate 2014 growth after slowdown drags on

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BANGKOK, 20 April 2014  The Bank of Thailand (BoT) has announced to revise the country’s economic growth forecast again in June following a continuous slowdown and budget disbursement delay.

BoT Governor Prasarn Trairatworakul said the central bank would likely decrease its previous growth estimate of 2.7% due to the sluggish economy and the government’s 2014 budget problems caused by the dissolution of parliament. The central bank was concerned over decreasing domestic consumption and confidence of the private sector but it started to see signs of lower household debt, the governor said.

As for policy interest rate, Mr Prasarn said the 2% rate was still suitable for the Thai economy but warned that keeping it low for a long time would pose risks similar to those which had led to the latest real estate bubble and financial crisis in the U.S.

The Monetary Policy Committee’s next meeting on policy interest rate is scheduled on 23 April.