Thailand Keeps Policy Rate At 2.50 Pct

BANGKOK, Nov 29 (Bernama) — The Bank of Thailand (BoT) kept its key policy rate at 2.50 per cent to support the country's economic recovery while ensuring sufficient policy space in light of the uncertain economic outlook.

The Monetary Policy Committee (MPC) today voted unanimously to maintain the policy rate at 2.50 per cent, the highest in a decade.

MPC secretary Piti Disyatat said the overall Thai economy continues to recover, despite some slowdown in merchandise exports and related production. 

He said growth is expected to be more balanced in 2024 and 2025, supported by domestic demand, tourism, and a recovery in merchandise exports. 

“Inflation should increase next year in line with the economic recovery and El Niño-related supply pressure. 

“With output continuing to recover, the committee deems the current policy interest rate conducive to keeping inflation sustainably within the target range, fostering long-term macro-financial stability by preempting the build-up of financial imbalances, and ensuring sufficient policy space in light of uncertain outlook,” he said in a statement.

The BoT also cut its growth forecast for this year to 2.4 per cent from 2.8 per cent and lowered its 2024 growth outlook to 3.2 per cent from 4.4 per cent. 

“The broad trajectory of the economy is one of continued recovery, driven by a robust expansion in private consumption on the back of services spending as well as an improvement in employment and labor income.

“Merchandise exports and tourism have been recovering more slowly than expected, due to subdued growth in China and a delayed turnaround in global electronic demand. 

“Looking ahead, growth should be more balanced, as tourism continues to recover and merchandise exports start to expand,” it said. 

— BERNAMA