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Thailand’s Struggle to Deploy Fiscal Spending Weighs on Outlook

  • Finance minister resignation, protests pose risk to economy
  • Central bank has cut interest rate to record low to aid growth

Fiscal policy is back in focus in Thailand as the central bank runs out of conventional monetary policy space to spur the economy.

With interest rates near zero, the Bank of Thailand last week called for “more targeted and timely” government policies to support the recovery. Yet latest figures show the government has been slow to disburse its pandemic aid and the sudden resignation of the finance minister has thrown the policy outlook into turmoil.