Actual Thai economic figures behind call for rate cut, insists NESDC chief
The National Economic and Social Development Council (NESDC) chief denied the council’s call for the central bank to lower interest rates had been made due to pressure from Prime Minister Srettha Thavisin.
Danucha Pichayanan, NESDC secretary-general, asserted on Tuesday that the decision was based on economic data, stating: “I see the figures, so I think it’s worth considering.”
He clarified that NESDC’s recommendation for a rate reduction stems from lower-than-expected economic indicators and a notable rise in overdue payments over the past three months.
While acknowledging a previous conversation with the Bank of Thailand (BOT) governor, Danucha stressed that the conversation was initiated due to the absence of comprehensive economic figures at the time. He merely suggested the matter of reducing interest rates be considered during that exchange.
Regular discussions between NESDC and BOT continue, with further deliberations on the course of action forthcoming. Danucha underscored the importance of recognising the independence of BOT and its Monetary Policy Committee (MPC), reiterating that decisions on interest rates must be deliberated within the MPC.
As for the possibility of a special MPC meeting, Danucha noted that it depends on the committee’s considerations. Expressing concern about rising household debts, the NESDC secretary-general noted that it depends on the committee’s considerations.
Expressing concern about rising household debts and non-performing loans, he called on the BOT to explore various financial measures beyond interest rate adjustments.
On Monday, NESDC called for financial intervention to bolster Thailand’s economy in response to mounting household debts and rising non-performing loans among small and medium-sized businesses.
NESDC cited troubling economic indicators, emphasizing the urgent need for additional financial measures despite the government's previous fiscal initiatives.
