The Commerce Ministry anticipates that the recently lowered interest rate announced by the Monetary Policy Office, could increase the nation’s inflation rate by 0.0025% while expressing confidence that Thailand’s economy would still grow 2 to 2.8%.
The Director General of the Ministry’s Office of Trade Policy and Strategy, Ampawan Pichalai, stated that at the MPO’s adjusted rate, economic growth is likely, as the lowered benchmark rate should stimulate public spending, and encourage investment in the short term. She cited the inflation rate as worth monitoring but that it should not affect local economic growth
Ms. Ampawan quoted her office’s report that the modified interest rate would also slightly relieve the burden of household debt, while noting threats to good economic performance are drought and fuel prices.
However, if public spending and private sector investment are still lackluster, the MPO might again adjust the benchmark rate downwards, later this year.