As central banks around the world, including those in developed markets, shift towards easing monetary policies, the Bank of Thailand's governor, Sethaput Suthiwartnarueput, has indicated that further interest rate cuts in Thailand are unlikely in the near future. He stated that the threshold for additional cuts is 'reasonably high,' following the bank's first rate reduction in over four years due to slowing credit growth [b6346430].
This cautious stance comes as the Reserve Bank of New Zealand recently cut interest rates by 0.5 percentage points to 4.75% on October 8, 2024, amid rising unemployment and falling house prices, reflecting a broader trend among central banks responding to economic slowdowns [f1a58ddc].
Suthiwartnarueput emphasized that future monetary policy decisions will hinge on key factors such as inflation, economic growth, and financial stability. He acknowledged ongoing pressure from Prime Minister Paetongtarn Shinawatra's government for lower rates and a higher inflation target, but described the recent rate cut as a 'recalibration' rather than the beginning of a sustained easing cycle [b6346430].
In a global context, the Swiss National Bank and the European Central Bank have also implemented rate cuts, with the Federal Reserve expected to follow suit by year-end [6ace642b]. The Bank of Canada is anticipated to lower rates on October 23, potentially by 50 basis points to 3.75% [6ace642b].
Concerns regarding the impact of China's slowing economy on Thailand's exports and tourism were also raised by Suthiwartnarueput, who cautioned against hasty tariff decisions that could exacerbate economic challenges [b6346430]. As central banks navigate these turbulent economic waters, the focus remains on balancing growth with inflation control, with Thailand's monetary policy reflecting a more cautious approach compared to its global counterparts [6ace642b].