Central bank keeps repurchase rate unchanged

The Bank of Thailand's monetary policy committee (MPC) has left the repurchase rate (RP) unchanged at 2.75%, as expected by the market.

The panel considered that the current key policy rate is suitable for boosting the economy and curbing inflation.

It said the decision was based on the fact that domestic demand continued to grow well, private investment has been substantially increasing and the economic recovery was better than earlier projected.

The committee would keep a close watch on the development of Thailand and global economic development to timely come up with a suitable monetary policy.

BOT assistant governor Paiboon Kittisrikangwan said the improvement in consumer spending and investment in October suggested that the country's economic growth this year might be slightly better than the latest projection of 5.7% and next year's growth might be higher than 4.6%.

The central bank's projection is in line with a report on pay rise in Asia Pacific which shows that Thailand's average salary increase in 2013 is projected at 6%, slightly higher than 5.7% pay rise in 2012.

With such a projection, Thailand stands in the middle spectrum in Asia Pacific, where predictions range from 2.3% to 12.0% - a slight increase from 2012.

                                       Source: Towers Watson

Towers Watson, a global professional services company, says its latest 2012 Third Quarter Asia Pacific Salary Budget Planning Survey indicates that companies across the Asia-Pacific region expect salary budgets in 2013 to grow slightly faster than 2012 in response to better macroeconomic outlook and improved business sentiments.

Over 90% of the survey respondents also plan to hire new employees in the next 12 months, a strong testament to the positive hiring outlook in the region.

For all 13 markets covered in the survey, salary growth rates are expected to outpace projected inflation rates for the respective markets for 2013.

Rachelle Arcebal, Towers Watson's global data services practice leader, Asia Pacific, said  business confidence has improved significantly over the last few months, and nearly two-thirds of the companies in the region are now more positive about their business performance.

However, the survey shows that companies in the region are only projecting a slightly faster salary increase for 2013. This indicates that employers are generally still in a cautious mood.

Respondents from both Vietnam and India are budgeting a double-digit salary increase of 12.0% in 2013, the highest within the region. These two countries are also most affected by inflation, with India being expected to post the region's highest inflation rate of 7.6% in 2013, followed by Vietnam with 6.9%

Japan is at the bottom with the projection pay rise of 2.3% in 2013, the same rate as 2012.

The survey also shows that the business outlook in the region has improved significantly over the past six months. Almost two-thirds (65%) of the respondents have a favourable outlook for their business and expect their business performance to improve by end of 2012.

In line with the improved business outlook, 91% of respondents say they plan to hire new employees in the next 12 months, with a strong focus on sales, engineering and marketing jobs.

In terms of staff turnover rates, China, India, Japan, Singapore and Thailand are expected to register slightly higher voluntary staff turnover in 2013, while Indonesia, Malaysia, Taiwan and Vietnam are projected to have lower voluntary staff turnover in 2013.

Related search: Thailand, interest, policy rate, pay rise, salary increase, Asia Pacific

Bangkok Post online classifieds

Try buying selling goods and properties 24/7 in our classifieds which has high purchasing power local expatriate audience from within Thailand and around the world.

Article source: http://www.thethailandlinks.com/2012/11/28/central-bank-keeps-repurchase-rate-unchanged/