Sign up | Log in



Home  >>   Daily News  >>   Thailand News  >>   Economy  >>   New finance minister prods central bank
NEWS UPDATES Asean Affairs           16   August  2011

New finance minister prods central bank

Related Stories

August 3, 2011
New government to stimulate Thai economy

August 1, 2011
Thailand economy peaks in three months

July 28, 2011
New Thai mortgage plan to cost plenty

July 16, 2011
Proposed pay scale for Thai grads is problematic

July 6, 2011
Business opposes 300 baht Thai minimum wage

July 1, 2011
Thai bank governor cautions on fiscal crisis

New Finance Minister Thirachai Phuvanat-naranubala is questioning the Bank of Thailand's hawkish focus on inflation by lifting the policy interest rate again, saying it would be a key obstacle for businesses.

On his first day as finance minister, the former deputy governor of the central bank slated the regulator's inflation-targeting framework, saying raising interest rates helps control inflation but hurts domestic purchasing power.

Mr Thirachai said he will discuss with the central bank the possibility of increasing the core inflation target from 3 percent.

He added the central bank's policy also attracts more foreign capital inflows, especially as US rates are nearly zero and will be for two more years. Consequently, the baht has appreciated rapidly.

"I want to see fiscal and monetary policies in the future not only focused on economic data from the past, but also concerned with the problems and suggestions from the private sector," said Mr. Thirachai.

He demanded a new committee chaired by the finance minister be set up soon to monitor the economy, with participants including the central bank governor, related state agencies, the Federation of Thai Industries, the Thai Chamber of Commerce and other business leaders.

Mr Thirachai is also concerned that the central bank resolve the one trillion baht in liabilities of the Financial Institutions Development Fund (FIDF) dating from the financial bailout during the 1997 economic crisis.

Even though he admitted the central bank needs to be free from intervention, he pointed out both the Finance Ministry and the Bank of Thailand are moving in the same direction.

"While I don't want to interfere with monetary policy, I would ask the central bank whether it has considered the downside risk of its policies," stressed Mr Thirachai.

M.R. Chatumongol Sonakul, the chairman of the central bank, said the Finance Ministry is responsible for the FIDF debt, because it issues bonds to refinance them.

"There's no way the central bank's balance sheet could turn a profit as long as the baht strengthens from the dollars it collects in the market," said M.R. Chatumongkol.

"The central bank did trade in the market for gains. It does so for the sake of foreign exchange flexibility," he added.

Regarding core inflation, M.R.Chatumongol views a low and predictable inflation environment as more conducive to private-sector investment.

Reach Southeast Asia!
10- Nations, 560- Million Consumers
And $1 -Trillion Market
We are the Voice of Southeast Asia Media Kit
The only Media Dedicated to Southeast Asia Advertising Rates for Magazine
  Online Ad Rates

Comment on this Article. Send them to

Letters that do not contain full contact information cannot be published.
Letters become the property of AseanAffairs and may be republished in any format.
They typically run 150 words or less and may be edited
submit your comment in the box below




1.  Verifier

1. Verifier

For security purposes, we ask that you enter the security code that is shown in the graphic. Please enter the code exactly as it is shown in the graphic.
Your Code
Enter Code

Today's  Stories    16  August  2011 Subsribe Now !
 • Tax holiday for high-value Indonesian investors Subcribe: Asean Affairs Global Magazine
• Indonesia seen as attracting FDI Asean Affairs Premium
• Laos town going down the tube
Research Reports
on Thailand 2007-2008

•Textiles and Garments Industry

•Coffee industry

•Leather and footwear industry

•Shrimp industry

• Iskandar investments expected to reach goal
• “Philippine customs agents should be jailed”
• Thai mobile firm ignores government agency
• New finance minister prods central bank

• Vietnam discouraging unskilled labor

Asean Analysis    16  August  2011

Advertise Your Brand
• China’s train ride on hold? Sponsor Our Events

Asean Stock Watch   16  August  2011

• Asean Stock Watch-August 16 p

ASEAN NEWS UPDATES      Updated: 04 January 2011

 • Women Shariah scholars see gender gap closing
• Bank Indonesia may hold key rate as inflation hits 7 percent

• Bursa Malaysia to revamp business rules
• Private property prices hit new high in Singapore
• Bangkok moves on mass transport
• Thai retailers are upbeat
• Rice exports likely to decline
• Vietnamese PM projects 10-year socioeconomic plan


This year in Thailand-what next?

AseanAffairs   04 January 2011
By David Swartzentruber      

It is commonplace in journalism to write two types of articles at the transition point between the year that has passed and the New Year. As this writer qualifies as an “old hand” in observing Thailand with a track record dating back 14 years, it is time take a shot at what may unfold in Thailand in 2011.

The first issue that can’t be answered is the health of Thailand’s beloved King Bhumibol, who is now 83 years old. He is the world's longest reigning monarch, but elaborate birthday celebrations in December failed to mask concern over his health. More


Home | About Us | Contact Us | Special Feature | Features | News | Magazine | Events | TV | Press Release | Advertise With us

Our Products | Work with us | Terms of Use | Site Map | Privacy Policy | Refund Policy | Shipping/Delivery Policy | DISCLAIMER |

Version 5.0
Copyright © 2007-2015 TIME INTERNATIONAL MANAGEMENT ENTERPRISES CO., LTD. All rights reserved.
Bangkok, Thailand