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Industrial confidence bounces back
Thailand's industrial confidence index made a U-turn, increasing from 73.6 in June to 76.9 in July as operating costs in the country's industrial sector fell due to soften oil prices, according to the Federation of Thai Industries (FTI).
Adisak Rohitasune, deputy chairman of the FTI, said the survey, conducted among a random sample of 1,048 operators in 39 industrial groups, showed that most industrial operators had enjoyed a continued increase in total purchase and sales orders. The weakening of the baht for the fourth consecutive month had also boosted industrial competitiveness, he said.
Confidence for the three months ahead rose to 82.9 from 77 because operators believe their performance will benefit from declining oil prices and the weakening of the baht.
He said industries that have recorded above 100 include alternative energy, waste treatment, refineries and gas. It should be noted that three of the four industries are energy-related, and they had benefited from the surging energy prices.
Adisak said confidence among industrial operators in all regions except the east had increased as a result of a decline in operating costs and an increase in total purchase and sales orders.
He said that confidence among the operators focusing on distribution in both local and overseas markets also increased because they had benefited from the implementation of the recent government economic stimulus package and the weaker baht that had helped to boost their competitiveness.
He said the business environment in July improved for the first time this year due to declining oil prices, relative currency stability, and lower inflationary pressure. - Thai News Agency (TNA).
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TDRI: Central bank 'should remain independent'
The Bank of Thailand (BOT) should be allowed to work independently, but it must liaise more closely with the government to supervise responses to inflation, according to a leading academic from the Thailand Development Research Institute (TDRI).
Speaking at a seminar called, “Is it Necessary for the Bank of Thailand to Work Independently?”, held by Chulalongkorn University's Faculty of Economics, Ammar Siamwalla, acting president of TDRI, said the central bank needs to work independently and without political intervention. However, the scope of its independence must be clearly delineated, he said.
More importantly, the bank must have a free hand to supervise financial institutions. Its performance must not be the subject of political intervention, as occurred during the 1997 financial crisis.
He said the bank had to liaise more closely with the ministry of finance and the cabinet in managing inflation control targets. The Monetary Policy Committee should not serve as the sole body setting inflation targets as it had done in the past four to five years, he said.
Ammar emphasized that the bank should not intervene in currency exchange rate activities on a daily basis, but should distance itself from the daily expectations of people who receive or lose benefit through interventions, such as the bank's decision to float the baht. - Thai News Agency (TNA).
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