Thursday, March 29, 2012

Kittirat versus Prasarn: It's not exactly an 'argumentative' thing

Deputy Premier and Finance Minister Kittirat na Ranong appears disturbed by an "argumentative" central bank. And he seems to suggest that the central bank governor, Prasarn Trairatvorakul, should 'argue less with me."

It's all about Kittirat's public statement the other day that he would like to seen the Bank of Thailand pursue a policy that would make the baht weaker so that Thai exporters will stand to benefit. He also said the central bank should bring down interest rates to stimulate the economy.

Prasarn has publicly said that the baht exchange rate, now under the "managed float" system is working fine and any attempt to tamper with the exchange rate would only distort the situation unnecessarily since the country's economy is picking up nicely now. He also "argues" that the current interest rates are appropriate and are among the lowest in the region anyway.

Kittirat told reporters yesterday: "I am not only the finance minister. I am also in charge of the country's economy as a whole.I think the central bank should argue less with me. Things would be just fine if the Bank of Thailand listens more to me..."

I have always believed that the central bank should be "argumentative" especially when it feels duty-bound to make its stand clear vis-a-vis the politicians.

Being courageous isn't exactly the same as being argumentative, I think.

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