Ceasefire Breached In Hours? Thailand Vows ‘Appropriate Response' To New ‘Cambodia Attacks'
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Mint
13 hours ago
- Mint
There's a price to pay for ardent rate cutters put in charge of central banks
Next Story Daniel Moss Thailand offers a case study. Its government made a switch in the leadership of its central bank, but it may soon find that an obedient monetary authority isn't good for its economy. The autonomy model can't be dumped without adverse consequences. Easier money won't solve every Thai problem Gift this article Thailand was saddled with US tariffs and forced to call it a good deal. But the country's besieged political leaders have managed a feat that President Donald Trump has so far found elusive. Thailand was saddled with US tariffs and forced to call it a good deal. But the country's besieged political leaders have managed a feat that President Donald Trump has so far found elusive. In naming an advocate of aggressive monetary easing to be the next central bank chief, they got the financial manager they want—or think they want. The benefits may be short-lived. After a campaign to pressure the Bank of Thailand to juice growth, the Thai cabinet tapped a critic of the incumbent governor to lead it. More stimulus is warranted: Deflation is a threat, business confidence is low and recession is a real possibility. The bank has eased policy this year, though it is reluctant to speed up. Outgoing chief Sethaput Suthiwartnarueput has defended the institution's independence, while being careful not to rule out additional reductions. Things seem stuck. The government will almost certainly get the lower borrowing costs it's seeking once Vitai Ratanakorn takes over in October. Beyond the rate reductions that the government wants, it's unclear what the finance ministry gets. The case for cuts justifies a shift at the top, though perhaps only just. The move won't be cost-free. The caffeine jolt from further easing may be noticeable, but brief. Of greater concern may be the long-term damage done to the bank's standing, specifically its autonomy. In announcing Vitai's appointment, the cabinet bypassed a respected deputy governor. That prospect prompted a group of academics to write an open letter on the eve of the announcement expressing their preference for an insider. More damaging—and indulgent—was finance minister Pichai Chunhavajira's declaration that Vitai will work hand in glove with the state. 'Its direction should align with the government's broader economic strategy," he said. Every leader wants their own person atop powerful institutions like central banks; in the US, Trump has vilified Federal Reserve chair Jerome Powell, whom he appointed in 2018 and was granted a second term by Joe Biden. Now, the White House wants him out—Powell's term ends in May—and Trump says enthusiasm for rate cuts must be on the resume of his successor. This game is far more dangerous than the one being played in Bangkok. The Fed sets the tone for policy globally and investors are highly sensitized to the slightest shift in stance or even rhetoric. The dollar's role as the main reserve currency gives America's central bank primacy. Should the Fed be seen to bend the knee to the administration, the consequences will be huge. Trump's recent decision to fire the head of the main statistics agency in response to some dour US employment figures is alarming enough. Borrowing costs will almost certainly come down in Thailand. But rates had been likely to fall anyway. The incumbent had cut them three times since October, and the soft economy means that whoever succeeded him was going to err on the side of more stimulus, not less. This will be about the pace and extent of easing, not whether it happens at all. Was installing an outsider who made his pitch as a forceful change agent worth the disruption? Probably, but it's a close call. Inflation is well below the authority's target, unlike in the US. Tariffs are likely to be inflationary in America; the country that is the origin of the exports will suffer a slowdown. Easier money won't solve every Thai problem and the bullying from politicians has likely been counterproductive. It's also true that independence ultimately derives from the political process; it has proven useful, but isn't a sacrament. As former Reserve Bank of Australia governor Ian Macfarlane testified last year, the condition 'is not God-given." Also read: Mint Primer | Signals for India from what global central banks did What the Thai government cannot know is how Vitai will respond to a change in circumstances that may require holding rates or even hiking them. He must also be a canny diplomat; borrowing costs are decided by a seven-member committee. He will need to win minds consistently. Vitai and his backers will own the results soon enough. Lawmakers will need to move on and find some new scapegoats, but that's assuming they'll be in power long enough. ©Bloomberg Topics You May Be Interested In Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
Time of India
a day ago
- Time of India
Thai woman, Nigerian man arrested with MD drugs
Bhopal: In a major breakthrough in the ongoing crackdown on the Yasin-Shahwar drug trafficking ring, Bhopal Crime Branch on Tuesday claimed to have arrested a Thai woman and a Nigerian national for allegedly supplying synthetic drugs in the city. Police seized 2.95 grams of MDMA (commonly known as MD) during the operation. According to police, the Nigerian national is believed to be the primary MDMA supplier for Yasin's network, while the Thai woman was actively involved in distributing drugs both online and offline in Bhopal and Delhi. The woman also worked at spa centres in the city, allegedly using them as fronts for drug peddling activities. Following the arrest of six members of Yasin's gang, police expanded their probe and unearthed links to Delhi, where a Nigerian man was identified as a key supplier. The Thai woman ferried consignments to Bhopal over the past two years and even rented a flat in Sheetal Dham, Hoshangabad Road, to facilitate operations. The Crime Branch nabbed the 41-year-old Thai woman from her residence and recovered 2.95 grams of MDMA, which was intended for a private party at a city farmhouse. However, the woman was unaware of the exact destination for the consignment. The woman has a prior record of a fraud case registered at Gandhi Nagar police station, Bhopal. The arrested Nigerian national, identified as 34-year-old Orachor Onyeka, is already facing cases under the Foreigners Act and fraud sections at DLF Phase-1 police station in Delhi. Onyeka has a sprawling drug distribution network across Bhopal, Delhi, and other Indian cities. Police sources revealed that he imports MDMA from foreign countries and has been operating in India for the past seven years. He contacted his clients through WhatsApp, Telegram, and other online platforms. He supplied MDMA to the nabbed drug peddlers Yasin and Shahwar. Cops believe that he might be manufacturing the chemical drugs at his hideout. Spa Centres Under Scanner After Thai Woman's Arrest: The Crime Branch officials confirmed that the arrested Thai woman worked at multiple spa centres in Bhopal and Delhi. This has brought the city's spa establishments under police scrutiny to ascertain if they were used as drug distribution hubs. Officials hinted that more names might surface during the ongoing investigation. Additional DCP (Crime Branch) Shailendra Singh Chouhan said that police recovered Indian SIM cards from the nabbed Nigerian man and Thai woman. They were issued on a local Indian individual's identity. Police are investigating the numbers and trying to contact the person on whose documents these SIM cards were issued. If the accused fraudulently used the documents to get the SIM cards, a separate FIR will be registered against them. Police Commissioner Harinarayanchari Mishra said, "Both foreign nationals are being interrogated further. The Nigerian was primarily operating through Delhi, while the Thai woman was active in both Delhi and Bhopal. More revelations are expected as the investigation progresses."
Hindustan Times
2 days ago
- Hindustan Times
Thailand plans $572 million stimulus spending and will compensate border conflict casualties
BANGKOK -Thailand will spend 18.5 billion baht on stimulus measures to support the economy as it braces for the impact of U.S. tariffs, and will compensate families of those who died in last month's border conflict, officials said on Tuesday. Thailand plans $572 million stimulus spending and will compensate border conflict casualties The stimulus measures approved by cabinet are aimed at enhancing economic competitiveness and supporting student loans, Deputy Finance Minister Julapun Amornvivat told reporters. The government still has about 25 billion baht of funds to use to mitigate the impact of U.S. tariffs and for broader relief efforts, Julapun said. The U.S. last week set a 19% tariff on imported goods from Thailand, lower than the 36% rate announced earlier this year and more aligned with other countries in the region. Julapun said cabinet gave the government approval to prepare a joint statement on tariffs and trade with the United States, but said discussions were ongoing and there was no set signing date. On Tuesday, the University of the Thai Chamber of Commerce said it expected the economy to grow 1.7% this year. That is below both the finance ministry's revised forecast of 2.2% growth in 2025 and last year's actual growth of 2.5%. The cabinet also approved a 10 million baht payment to the families of government officials who died in the July conflict with Cambodia, while those injured will receive up to 1 million baht, government spokesperson Jirayu Huangsap told a briefing. Families of Thai civilians who died during the conflict will each receive a payment of 8 million baht, he said, while the injured would receive up to 800,000 baht. This article was generated from an automated news agency feed without modifications to text.
