Thai PM says central bank rate hikes no good for economy

BANGKOK (Reuters) – Thai Prime Minister Srettha Thavisin said the central bank’s rate increases have not been good at all for the economy, urging it to avoid moves that will adversely impact low-income families and small businesses.

The government of Srettha, a real estate tycoon who took office in August, is seeking to spur growth in Southeast Asia’s second biggest economy though stimulus and consumer spending, with Thailand trailing regional peers with growth forecast at about 2.4% last year, short of the 2022 figure.

“The Bank of Thailand has raised interest rates despite of negative inflation for many consecutive months is not good for the economy at all and also has an impact on people with low incomes and SMEs,” he said on X social media late on Sunday.

The central bank left its policy rate unchanged at 2.5% in November after raising it by 200 basis points since August last year to curb inflation. It will next review policy on Feb. 7.

Headline inflation came in at -0.83% in December, making it the eighth straight month that it was outside the central bank’s target of 1% to 3%.

Srettha said he hoped the central bank would “help take care of the people by not raising rates in the opposite direction of inflation.

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