BANGKOK (REUTERS) - Thailand's central bank chief said on Tuesday any big interest rate cut would not help revive the economy hit by political unrest, but monetary policy would remain accommodative to support businesses.
Bank of Thailand Governor Prasarn Trairatvorakul told the Senate's financial commission the recent rate cut might only help sentiment. "Monetary policy is not cure-all medicine. It can help but it can't replace others," he said.
On March 12, the central bank's monetary policy committee voted 4-3 to cut the benchmark rate by 25 basis points to 2.0 per cent to boost confidence and spur spending.
Three members voted to hold, arguing that the current rate remained accommodative and the main headwinds to growth were not financial.
The prolonged unrest has hurt domestic demand and confidence as well as delayed public spending, so the central bank is under pressure to cut rates to support growth.