Baht remains stable as ECB maintains benchmark rate and China cuts rates
The Thai baht remained relatively stable last week in the wake of the European Central Bank (ECB)'s decision to maintain its benchmark rate and People's Bank of China's cuts of one-year benchmark interest rates, according to the Bank of Thailand (BOT).
Chirathep Senivongs Na Ayudhya, BOT spokesman, said yesterday that the Thai currency was relatively stable last week while two issues of monetary decisions have been made by other central banks.
Last week, markets focused on the ECB’s decision to leave its benchmark rate at 0.05 per cent and its 60-billion-euro-per-month asset purchase programme until the end of September 2016 or inflation to be close to the target of 2 per cent.
The euro weakened from US$1.135 to $1.10 yesterday morning.
However, markets assessed the ECB statement to have concerns over the economic growth of emerging-market countries and that could become a downward risk to the euro zone in the next periods. The ECB will review its monetary policy in its December meeting again.
Last Friday, China’s central bank combined a quarter-point cut in its one-year benchmark lending and deposit rates with a half-percentage reduction in banks’ reserve requirement ratios, moves aimed at spurring the Chinese economic growth as targeted.
This week, the Federal Open Market Committee (FOMC) and Bank of Japan (BOJ)’s meetings and a key meeting of China’s Communist Party to draft the country’s five-year development plan will be monitored.
