BOT ignores politics in data review
The Bank of Thailand (BOT) is reviewing its forecasts for this year's economic indicators without taking the country's political turmoil into account, the central bank's governor, MR Pridiyathorn Devakula, said yesterday.
He said the BOT was not assuming that caretaker Prime Minister Thaksin Shinawatra would step aside in preparing its economic projections to be released at the end of the month."We evaluate and revise the economic conditions based on real data," Pridiyathorn said. He is optimistic about the economy, saying that the likes of exporter-manufacturers can run their businesses smoothly no matter whether Thaksin continues to be the premier or not. "No matter [whether] Khun Thaksin steps aside, they can [continue to] export as they have been doing," the BOT governor said. The private sector believes export growth could be about 15 per cent this year despite the political turmoil and with or without the formation of a new government. The Commerce Ministry's target for export growth this year is 17 per cent. However, the central bank forecasts that it will be only 10 per cent to 12 per cent. BOT figures show that exports rose by 18.9 per cent in the first two months of the year, while import growth was only 7.4 per cent. The political impasse has put additional negative pressure on the confidence of consumers and businesses when it is already suffering from high oil prices. The central bank's private consumption index contracted by 0.1 per cent in February, following two months of rises. Pridiyathorn said earlier that he would try to keep economic stability on track and encourage good sentiment despite political uncertainty. So far, BOT officials have avoided making any comment about the impact of the political strife on the economy. Revised growth and inflation forecasts will be formally released at the end of the month. The central bank's current projection for economic growth is between 4.75 per cent and 5.75 per cent. Meanwhile, Pridiyathorn said the banking system's liquidity is currently neutral, in line with the level of interest rates. He said small-sized banks have not lost their competitiveness in attracting depositors and lenders because they have known how to change their business strategies to meet customers' demands. DBS Group's research forecast the BOT would not raise rates again during its Monetary Policy Committee meeting next Monday. Currently, inflation is showing visible signs of retreating, with headline inflation touching 5.7 per cent in March, from a peak of 6.2 per cent in October. Anoma SrisukkasemThe Nation
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