Thai economy unlikely to return to levels seen before Covid-19 pandemic until 2022: Thai Central Bank

The Thai central bank earlier forecasted the Thai economy to shrink a further 8.1 per cent this year, with foreign tourist numbers plunging 80 per cent as the pandemic cuts global demand and travel. - AFP

BANGKOK (Xinhua): Thailand's central bank on Tuesday (July 14) said in a press briefing that Thailand's economic activities are unlikely to return to levels seen before the Covid-19 pandemic.

"Not until year 2022," said Bank of Thailand (BoT) Governor Veerathai Santiprabhob,"also, the BoT cannot offer the record-low policy interest rate of 0.50 per cent to zero per cent."

The Thai central bank earlier forecasted the Thai economy to shrink a further 8.1 per cent this year, with foreign tourist numbers plunging 80 per cent as the pandemic cuts global demand and travel.

"However, the Thai economy should gradually recover after hitting the bottom in the second quarter," said Veerathai.

The BoT governor said he believes the pandemic will continue as second wave spikes are occurring in many parts of the world.

"But the Thai government should be able to handle the impact on the Thai economy," Veerathai reassured,"there is no need for strong measures yet."

Veerathai commended the Thai government for handling the Covid-19 cases in Thailand, saying "Thailand has on Tuesday entered 50 days free of local transmission."

The BoT has already cut its policy rate three times this year to 0.50 percent to cushion the outbreak impact on Thailand's economy.

Veerathai said cutting the policy rate to zero will affect the economic system and savings.

Policy space should be preserved for the worst, said the BoT, which left rates unchanged last month and will next review the policy on Aug. 5. - Xinhua