Steps will spur economy: BOT
The Bank of Thailand yesterday said the fiscal stimulus that received the Cabinet's green light on Tuesday could lower business obstacles and accelerate state expenditure.
BOT senior director Mathee Supapongse said the approved fiscal measures would likely stimulate the economy, particularly business investment, lessen business obstacles and speed up government spending on its planned projects.
While the measures will not provide much stimulus for consumption appropriate to the current situation, the central bank will have to follow up on more details of each measure.
The fiscal measures came after the gross domestic product expanded less than expected at 5.3 per cent in the first quarter with expectations of 4-per-cent growth for the whole year.
In response to the US Federal Reserve’s likely reduction of its bond purchases in September, Mathee did not expect that move to create high volatility in the Thai money market as the possibility had already been factored in.
The Cabinet on Tuesday approved a number of measures related to private consumption, private investment, state expenditure and exports in order to promote stable economic expansion.
The move came as some economic indicators signalled a slowdown.
Finance Minister Kittiratt Na-Ranong said on Tuesday that more economic-stimulus measures would be introduced to increase the country’s GDP by 1 per cent or about Bt120 billion in value.
Salinee Wangtal, the BOT’s assistant governor for the Supervision Group, said the central bank had discussed with commercial banks how to cope with any situation that may occur if there were a negative political development. Commercial banks are allowed to activate emergency plans without the BOT’s approval.
