MPC has the final say: Prasarn
Bank of Thailand Governor Prasarn Trairatvorakul told a seminar yesterday that decisions on the benchmark interest rate were the purview of the Monetary Policy Committee, which is scheduled to meet next on October 19.
Inflationary pressure remains high because of oil prices, continuing expansion of domestic consumption and exports, and high inflation expectations, Prasarn said.
Inflation expectations could affect prices as set by producers and purchasing decisions of consumers, he said.
Currently, there is more threat to growth due to negative factors from foreign countries, especially the United States and Europe, he said. The central bank is following these situations very closely.
"If we let inflation rise, other costs will rise and that could drive interest rates up as well.
"This is because bond buyers will normally require yields higher than the rate of inflation, and that could push the interest rates up. Now, we are trying to prevent rises in long-term interest rates," Prasarn said.
