Whether the world’s central banks are ‘co-operating’ or competing is up for question but the tsunami of policy easings so far this year is making the ‘surprise’ rate cut, unsurprising. As Bloomberg reports,Thailand today became the latest to execute an unexpected interest-rate cut, bringing the total to 23 in 2015.
While only 6 of 22 economists expected it, the Southeast Asian country — a onetime export powerhouse that’s seen its manufacturing mojo dim somewhat in recent years amid historic flooding and political infighting — lowered its main rate to 1.75%. “The surprise move suggests the economy is much weaker than expected,” noted one analyst, adding that “it is negative for the baht and there’s concern that lower rates may lead to more outflows as the U.S. is expected to raise rates.”
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Craig Erlam
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