The central bank yesterday (Jan 18) assured that the low inflation rate last year didn’t indicate the country is facing deflation.
Assurance by the governor of the Bank of Thailand (BOT) Veerathai Santiprabhop came after the bank disclosed the overall inflation figures for 2017 at 0.60 which is 1% lower than projection.
He explained that the low inflation rate was due mainly to lower food prices and not an indicator of looming deflation which would severely derail economic recovery.
Mr Veerathai, also chairman of the Monetary Policy Committee, advised that the relaxed national monetary policy currently in place be extended for a little while to allow the economy to strengthen thereby helping inflation to return to acceptable levels.
Meanwhile, the Federation of Thai Capital Market Organizations forecast the economy this year would grow by between 3.9 – 4.1% driven mainly by the rise in private sector and state investments and the sustained growth in tourism.
It said these factors could result in a 153.94 point rise in the Private Sector Investment Confidence Index within the next 3 months which is a highly dynamic statistic.
Regardless of this, the private sector will be closely monitoring the political situation, especially the pending announcement of the date for general elections which will directly determine the course of the Thai stock market in the 3rd quarter of this year.