## Thailand's Central Bank Open to Adjusting Monetary Policy
Thailand's central bank is open to adjusting its monetary policy if the economic outlook changes and structural challenges clearly reduce its long-term potential growth. This statement comes amidst pressure from the government to cut interest rates.
Deputy Governor Alisara Mahasandana acknowledged the government's concerns but emphasized the need for the Monetary Policy Committee (MPC) to balance immediate and long-term economic factors when setting rates. She highlighted the importance of considering both short-term and long-term impacts on monetary policy objectives.
A recalibration of monetary policy could occur if there is a change in the growth and inflation outlook, or if structural impediments significantly lower long-term potential growth. The central bank currently forecasts a growth rate of 2.6% for 2024 and 3.0% for 2025, with uncertainties remaining around export recovery.
Alisara addressed concerns about negative headline inflation, clarifying that it does not reflect weak demand or deflation. She attributed the low inflation to energy subsidies and expects prices to rise in May.
Regarding the Thai baht, Alisara acknowledged its volatility driven by external factors, particularly dollar strength. However, she expressed optimism about domestic factors supporting the currency, citing improved economic activity and Thailand's current account surplus.