The case for a cut: Inflation is benign and with political turmoil hurting confidence and threatening to derail a generally resilient economy, the central bank should seize the opportunity and act now, some economists say.
The case against: Interest rates were cut twice last year, lending the economy some support and further easing could exacerbate the outflow of foreign cash if jitters about Federal Reserve tapering return to emerging markets, others argue.
“It’s certainly looking like there’s a pretty good chance of a rate cut this week,” said Sean Callow, senior currency strategist at Westpac Bank in Sydney. “They [Thai central bankers] have in the past placed some weight on political instability and the damage it can cause the economy.”
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