CIMBT: Monetary policy takes lead while cabinet unformedWith the cabinet line-up unsettled and fiscal policy handcuffed, CIMB Thai Bank (CIMBT) expects the Bank of Thailand to loosen monetary policy by cutting the benchmark rate twice by the first half of next year in a bid to boost economic growth and curb hot-money inflows. "Monetary policy should take the lead, not fiscal policy, while the new government is being formed," he said. The policy rate cut will help curb hot-money inflows after the baht's recent rally, Mr Amonthep said, adding that the central bank has several other instruments at its disposal. The rate cut will help the central bank curb hot-money inflows, particularly those flooding into local short-dated bonds, and shore up the sputtering economy, Mr Amonthep said. CIMBT downgraded its outlook for the country's economic growth outlook for 2019 to 3.3% from 3.7% predicted previously.

Source: Bangkok Post July 03, 2019 09:55 UTC