BANGKOK (Reuters) -Thailand’s central bank governor said four rate cuts since last year had made monetary policy more accommodative amid slower economic growth, and were intended to ease financial conditions rather than just be a short-term stimulus.
However, Sethaput Suthiwartnarueput, who finishes his term as governor at the end of September, warned at a news conference on Tuesday that structural fixes were needed to resolve a surge in private debt and reverse the decline in Thailand’s fiscal position.
“Fiscal ammunition is limited and there is risk of a ratings downgrade,” he said, adding that spending was higher than revenues.
When Sethaput’s term ends, former state-owned bank head Vitai Ratanakorn will take over. He is is seen as an inflation dove who will advocate for rate cuts to support growth.
(Reporting by Orathai Sriring, Kitiphong Thaichareon, Thanadech Staporncharnchai, Chayut Setboonsarng; Editing by John Mair and David Stanway)
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