The Bank of Thailand cut interest rates for the second consecutive meeting to help spur a recovery from the worst floods in almost 70 years as a deteriorating global economy threatens growth.
The central bank reduced its one-day bond repurchase rate by a quarter of a percentage point to 3 percent, it said in Bangkok yesterday.
Policymakers cut the rate for the first time in more than two years at the previous meeting on Nov. 30.
Thailand joins the Philippines, Indonesia and India in easing monetary policy after the World Bank said last week a recession in the euro region threatens to exacerbate a slowdown in emerging markets. Thai Prime Minister Yingluck Shinawatra has pledged to spend 350 billion baht (US$11.1 billion) on infrastructure to prevent a repeat of floods that caused the worst slump in industrial output in more than 10 years.
The baht weakened 0.2 percent to 31.54 per US dollar as of 3:17pm. The benchmark SET Index lost 0.7 percent. The currency has slipped about 2.2 percent in the past three months and the stock index gained about 12 percent.
“After two rate cuts, we think the current rate at 3 percent is appropriate for both growth and the inflation outlook,” Bank of Thailand Assistant Governor Paiboon Kittisrikangwan said at a briefing.
The economic impact of last year’s floods was greater than earlier estimated, and a recovery in manufacturing may be delayed by one to two months, Paiboon said.
The floods shuttered more than 16,000 factories, reducing Thailand’s economic growth last year to about 1.5 percent, compared with estimates of as high as 4.5 percent before the deluge, Thai Finance Minister Kittiratt Na-Ranong said last week.
Thailand’s economy, the biggest in Southeast Asia after Indonesia, may have contracted 5 percent last quarter from a year earlier, according to the finance ministry. Exports shrank 2 percent last month, compared with a 12.4 percent slide a month earlier, the commerce ministry said on Jan. 20.
Economic growth last year will be lower than an earlier estimate of 1.8 percent, Paiboon said.
The central bank now expects manufacturing output to return to normal in the third quarter, compared with an earlier forecast for a second-quarter recovery, he said.
Inflation pressure has eased, reflecting a more prolonged recovery in domestic demand and a slowdown in commodity price gains, he said. Reconstruction spending and government stimulus measures may still cause inflation to accelerate, he said.
The central bank is scheduled to give an updated economic forecast on Friday next week.
Anna Bhobho, a 31-year-old housewife from rural Zimbabwe, was once a silent observer in her home, excluded from financial and family decisionmaking in the deeply patriarchal society. Today, she is a driver of change in her village, thanks to an electric tricycle she owns. In many parts of rural sub-Saharan Africa, women have long been excluded from mainstream economic activities such as operating public transportation. However, three-wheelers powered by green energy are reversing that trend, offering financial opportunities and a newfound sense of importance. “My husband now looks up to me to take care of a large chunk of expenses,
SECTOR LEADER: TSMC can increase capacity by as much as 20 percent or more in the advanced node part of the foundry market by 2030, an analyst said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is expected to lead its peers in the advanced 2-nanometer process technology, despite competition from Samsung Electronics Co and Intel Corp, TrendForce Corp analyst Joanne Chiao (喬安) said. TSMC’s sophisticated products and its large production scale are expected to allow the company to continue dominating the global 2-nanometer process market this year, Chiao said. The world’s largest contract chipmaker is scheduled to begin mass production of chips made on the 2-nanometer process in its Hsinchu fab in the second half of this year. It would also hold a ceremony on Monday next week to
TECH CLUSTER: The US company’s new office is in the Shalun Smart Green Energy Science City, a new AI industry base and cybersecurity hub in southern Taiwan US chip designer Advanced Micro Devices Inc (AMD) yesterday launched an office in Tainan’s Gueiren District (歸仁), marking a significant milestone in the development of southern Taiwan’s artificial intelligence (AI) industry, the Tainan City Government said in a statement. AMD Taiwan general manager Vincent Chern (陳民皓) presided over the opening ceremony for the company’s new office at the Shalun Smart Green Energy Science City (沙崙智慧綠能科學城), a new AI industry base and cybersecurity hub in southern Taiwan. Facilities in the new office include an information processing center, and a research and development (R&D) center, the Tainan Economic Development Bureau said. The Ministry
State-run CPC Corp, Taiwan (CPC, 台灣中油) yesterday signed a letter of intent with Alaska Gasline Development Corp (AGDC), expressing an interest to buy liquefied natural gas (LNG) and invest in the latter’s Alaska LNG project, the Ministry of Economic Affairs said in a statement. Under the agreement, CPC is to participate in the project’s upstream gas investment to secure stable energy resources for Taiwan, the ministry said. The Alaska LNG project is jointly promoted by AGDC and major developer Glenfarne Group LLC, as Alaska plans to export up to 20 million tonnes of LNG annually from 2031. It involves constructing an 1,290km
RSS