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Thai finance minister says difficult to cut rates, drought a threat
[BANGKOK] Thailand's finance minster said on Thursday that interest rates were "extremely" low and it would be difficult to cut them further, although drought is threatening the already sputtering economy. "Lowering interest rates will be fairly difficult because ours are extremely low already," Sommai Phasee told reporters.
The policy rate is now at 1.50 per cent after two surprise cuts in March and April.
The central bank next reviews policy on Aug. 5.
Mr Sommai said drought could cut expected Thai economic growth by 0.5 percentage point this year if it was severe. "But we have good measures, the impact will be smaller," he said, adding the government were asking ministers to look at ways to cushion the impact on the farming sector.