Bank of Thailand (BoT) Governor Tarisa Watanagase says
the ongoing political rallies by the Red Shirt protesters are putting
Thailand’s sovereign position at risk of being downgraded. The downgrading
would fuel costs of offshore borrowing and shake investor confidence in
Thailand, she advised last week.
“We must take into account all factors in assessing the
impacts on the economy by assuming how the rallies will end,” she said, “and
whether what happens now differs from the assumptions.
“How the economy will be affected depends on confidence.
Investor confidence is most worrying now,” Tarisa said.
The BoT chief said the political crisis had begun to
impact the Thai economy, but how adversely it will affect depends on whether
the rallies end sooner or later.
At the same time, she said, the central bank must
consider the latest figures on exports, production, agriculture, and
industry before assessing impacts.
“There are many more days before the Monetary Policy
Committee meets on April 21. The committee will consider all factors
cautiously in assessing the gross domestic product growth,” she said.
Tarisa said the ongoing political standoff had not yet
affected the Thai capital market in terms of its functioning. The BoT will
attempt to oversee the liquidity in the system to ensure it is sufficient,
she said, adding that the currency exchange rate still moved in tandem with
internal and external market factors. (TNA)