Central Bank should cut requirement on capital inflows : Teerana
The central bank has to cut reserve requirement on capital inflows from 30 to around three to five per cent to lessen the drastic measures, said Teerana Bhongmakapat, an economist at Chulalongkorn University.
If the investors pull back their money within three or six months, they would lose the reserves. If they get money back within a year, they would get half of the reserves, he said. He said the 30 per cent reserve was too severe and it could adversely impact on both shortterm and longterm capital flow. He, however, said the central bank move in the right direction as it has try to introduce prudential management of macroeconomy which is under threat from shortterm capital flows. "The challenge is how the central bank could minimise the cost , the side affect coming along with central bank's goal to curb rising baht," he added. The Nation
|
