BOT board members differ on interest rate policy

 

 

 

Referring to the board meeting on the evening of Aug 16, he conceded that some members were concerned over the central bank's accounting losses which stem from money market operations.

BOT's aggregated losses in 2011 were tunned at Bt200 billion. 

Prasarn said that while board members involved in plotting monetary policies are not concerned with the losses, with understanding that excessive concerns may lead to inefficient policies and confusion in the money market. He noted that excessive losses deserve to cause concerns, but at the current level, the losses are not that huge. 

"Some members, including two deputy governors, two who also sit in the Monetary Policy Committee and me, understand this issue. I can't speak for the other members, who believe that lower interest rate would reduce the (central bank)'s interest burden. However, monetary policies can't factor in balance sheets, as this may cost public confidence," he said. 

  Still, he is positive that the different opinion can be addressed, also through a committee formed recently to look into the balance sheet. During this time, he hopes that Thailand would not witness an influx of foreign funds. At present, Thailand has witnessed balanced flows of funds, which reduces the need for stabilisation. 

The Bank of Thailand has 14 board members. 

Some of them represent the Finance Ministry, including Somchai Sajjapongse and Kanit Sangsubhan.