BANGKOK (Reuters) – Thailand’s finance ministry and central bank have agreed to maintain the current inflation target, the finance minister said on Tuesday, after a meeting of the two parties in which the government had sought a higher target to spur growth.
Finance Minister Pichai Chunhavajira met Bank of Thailand (BOT) Governor Sethaput Suthiwartnarueput and said the current 1% to 3% range in place since 2020 would be held, adding the BOT had agreed to support fiscal policy to boost growth.
The central bank has insisted the present target has worked well for the economy.
Actual inflation should move to 2%, Pichai said, adding that the central bank should consider inflation, foreign exchange when conducting monetary policy.
Pichai ahead of the meeting had said inflation would miss the target this year, as average annual headline inflation was just 0.20% in the first nine months of 2024.
Earlier this month, the BOT unexpectedly cut its key interest rate by 25 basis points to 2.25%, the first reduction since 2020 in October.
The government had been pressing all year for a cut, saying interest rates had stymied activity and was hamstringing its efforts to revive a sluggish economy.
The central bank had responded that structural issues were weighing on growth.
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