Deputy Prime Minister and Finance Minister Kittiratt Na-Ranong has thrown his support behind yesterday's 25-basis-point cut in the policy interest rate by the Monetary Policy Committee (MPC).
Kittiratt: MPC’s move is too small, too late
"It's too small and too late, but it's better than nothing," he told reporters after the rate cut announcement.
Mr Kittiratt had earlier requested the central bank's rate-setting committee trim the benchmark rate by 75 basis points to curb the influx of capital inflows and the baht's recent strength.
But pressure on the MPC for a rate cut was eased as the baht weakened on concerns the central bank might impose harsh measures to tame the currency's rise and the US Federal Reserve announcing plans to wind down its asset-buying scheme.
The baht yesterday sank to a four-month low of 30.18/30.24 to the US dollar.
"The current baht level allows export-related operators to run their businesses normally. The baht is not too strong to become a threat. Indeed, it's started a smooth softening," said Mr Kittiratt.
He said the satisfactory foreign exchange rate makes it unnecessary to implement any measures at the moment, which is good since any measures carry both pros and cons.
Mr Kittiratt said the ministerial regulations related to controlling capital flows have already been published in the Royal Gazette and so are readily available for implementation if they are needed.
The Bank of Thailand will take responsibility for imposing the measures if necessary, he said, adding that they would not, however, be retroactive.
Meanwhile, former finance minister Korn Chatikavanij will propose that senators remove Mr Kittiratt from his posts, saying the incumbent has failed to set up a National Savings Fund (NSF) on schedule.
Removing Mr Kittiratt from his posts would require a three-fifths vote of the Senate.