Bangkok: Following a court’s dismissal of the prime minister, the central bank of Thailand’s central bank left its key interest rate unchanged for a fifth straight meeting on Wednesday ( Aug 21 ), as was widely anticipated.
The Bank of Thailand’s ( BOT ) monetary policy committee voted 6-1 to hold the one-day repurchase rate at 2.50 per cent, the highest in more than a decade.
In a Reuters surveys, all but three of the 27 economists had predicted that the BOT would keep the rate constant this month. Three economics had predicted a quarter-point split.
The central bank stated in a statement that the majority of the committee believes that the present policy interest rate is appropriate for the country’s possible convergence and favors macro-financial stability.
A rate cut is never anticipated until the next quarter of 2025, according to the Reuters poll’s median forecast.
The committee’s one dissident member voted for a 25 bps cut to represent a lower growth potential from structural problems and to partially lower a debt-servicing problem on borrowers, according to the BOT.
Between August 2022 and September 2023, the BOT increased its vital level by 200 base items to 2.50 per cent, and it has maintained it ever since.
Last year, some central banks began easing their policies, including those in the Philippines and New Zealand. On Tuesday, Sweden received its second cut, and both the Bank of England and Switzerland both lately both announced charges reductions. Oct. 16 is the next BOT plan assessment.
The BOT predicted that as a result of better conditions problems, inflation would likely be lower than expected, with agricultural rates expected to remain subdued.
Inflation, which was 0.83 per share in July, had slowly return to its specific range of 1 per cent to 3 per share by the end of the year, it said, noting there was a need to track possible expansion of state amount subsidies.
Southeast Asia’s second-largest market grew 2.3 per share in the April-June third from a month earlier, accelerating from the 1.6 per cent rise in the previous quarter, but analysts said fiscal policy doubt clouded the outlook.
The BOT said the business was expected to grow as anticipated, led by commerce and domestic demand, despite a decline in personal use, while manufacturing was recovering just gradually, as some trade fields were still suffering from declining profitability.
The market may develop close to 3 per share in the second quarter year-on-year and nearer to 4 per cent in the last quarter, the BOT said at a press conference.