BANGKOK, July 2 – The Thai currency will remain highly volatile at around Bt30-31 against the dollar due to lower capital inflows and the gradual US withdrawal of its economic stimulus measures, a member of Thailand’s Monetary Policy Committee (MPC) said today.
Narongchai Akrasanee, concurrently president of MFC Asset Management, said capital inflows into newly emerging markets will be less active than last year when capital inflows to invest in the Thai bond market were as high as US$10 billion and stock market at US$2 billion.
Thailand’s economic growth this year will be 4-5 per cent which he described as satisfactory given the country’s balanced economic fundamentals and current account.
He cited household debt exceeding 80 per cent of the gross domestic product as a concern, while public and private debt remains low.
Domestic consumption has markedly slowed down as consumers must pay their debts including purchases of first cars and first houses under tax incentives offered by the government.
Mr Narongchai said expansion in the consumer sector has slipped together with sliding exports – the factors that affect Thailand’s economic growth.
He said the new cabinet must speed up its activity while economic ministers must meet regularly to promptly issue measures to keep pace with the dynamic economic situation.
