Thai Central Bank Chief Urges Shift From Rigid Inflation Target

The Bank of Thailand's Governor Sethaput Suthiwartnarueput has called for a shift from the current rigid inflation target approach. He argues that supply-side shocks, which are becoming more frequent, cannot be effectively addressed by traditional monetary policy tools. Suthiwartnarueput suggests that the central bank should focus on broader economic stability rather than solely targeting a specific inflation rate. This shift in approach would allow the bank to respond more flexibly to unexpected disruptions in the supply chain and other external factors that impact prices. The governor's remarks highlight the need for central banks to adapt their policies to the changing economic landscape, where supply-side issues play a more significant role in driving inflation. This call for a more holistic approach to monetary policy aims to ensure the central bank can effectively navigate the challenges of the modern economy.