Bangkok, The MPC is expected to maintain the interest rate at 2.50% today with a non-unanimous vote. Analysts point out that even if interest rates are cut, it will not hurt the economy. Because the main problem arises from the structure of the Thai economy. Chinese products hit the market Factories gradually closed
Mr. Poon Panitchpibun, money market strategist, Krungthai GLOBAL MARKETS, Krung Thai Bank, revealed that the baht opened this morning at 36.72 baht/dollar, slightly stronger from closing the previous day at 36.75 baht/dollar last night. The baht moved sideways in line with the directionless movement of the US dollar. Including the price of gold Because market players are waiting to learn more new factors. Especially the US inflation rate. And the results of the Federal Reserve (Fed) meeting are expected to be at the level of 36.60-36.80 baht/dollar in the period before the market gradually receives important US data reports. and the results of the Fed’s FOMC meeting
As for domestic factors, tod
ay the market will wait to see the results of the Monetary Policy Committee (MPC) meeting, with the view that the MPC will maintain interest rates at 2.50% with a unanimous 5-2 vote and that the market will Pay attention to your perspective. MPC on economic outlook (Will there be further adjustments to economic forecasts?) and signaling the outlook for monetary policy. In addition to the above factors Political issues, such as the consideration of the dissolution of the Progressive Party It is another factor that the market is keeping an eye on as well.
‘If the MPC signals readiness to reduce interest rates or surprise the market By reducing interest rates (Seeing that the chance of this happening is very low), it may not be difficult to pressure the fluctuating baht to depreciate,’ Mr. Poon said.
Mr. Thawatchai Assawapornchai, Deputy Managing Director Securities Analysis Department of ASL Securities stated that most markets expect that both the Fed and the MPC will cut interest rates only once this year. I
n the second half of the year, the MPC will not reduce interest rates today. which is an overview of the board’s consideration The MPC will look at inflation. Maintaining stability of the baht Not depreciating too much Including the Thai economy expanding below its potential. Which at the moment is a structural problem. income inequality Relocation of various factories leaving Thailand, import-export, and products from China entering the market. By this issue If interest rates are reduced, it is not a direct solution to the problem. Overall, the stock market declined apart from foreign economic problems. Political problems There is also the effect of economic signals that miss the target. This year it is still expected that Thai GDP will expand by 2.6 percent.
Source: Thai News Agency