BANGKOK (Reuters) – Thailand’s central bank has told the finance ministry that it will keep its policy rate at the current level to support the economy, Prime Minister Prayuth Chan-ocha told reporters on Tuesday.
Prayuth also said the finance ministry, central bank, commercial banks and the private sector in Thailand needed to do more to keep inflation in check.
“We have to find a way to solve the (inflation) issue … but it also depends on the external situation,” he said.
Thailand’s headline inflation rose at a much faster pace than expected in May, hitting its highest level in nearly 14 years on soaring energy prices and the end of some government support measures.
The Bank of Thailand’s monetary policy committee (MPC) will review policy rates on Wednesday.
Its board chairman, Porametee Vimolsiri, has said rates are set to rise, but timing would depend on the MPC’s view of the economy.
The MPC is widely expected to keep its key rate unchanged at a record low of 0.50% on Wednesday, and possibly for the rest of the year, to support the recovery, a Reuters poll showed.
On Monday, Finance Minister Arkhom Termpittayapaisith said fiscal and monetary policies must continue to align to ensure a full economic recovery and that the central bank should not consider raising its key rate until the economy recovers strongly.
(Reporting by Panarat Thepgumpanat and Orathai Siring; Writing by Martin Petty and Chayut Setboonsarng; Editing by Kanupriya Kapoor)
