Thailand Monetary Policy


Bank of Thailand holds rates for fourth straight meeting

At its 3 April monetary policy meeting, the Bank of Thailand (BoT) kept the one-day repurchase rate unchanged at 2.75%, in a decision broadly expected by the market. The decision marks the fourth consecutive meeting in which the Bank keeps rates on hold after an unexpected 25 basis-point cut in October last year.

The BoT expects the economy to moderate to a "normal trend" in the first quarter of 2013, after an acceleration in Q4 2012. That said, going forward, domestic demand will continue to support economic growth, which will also be aided by strong fiscal stimulus in the second half of 2013. Against this backdrop, the BoT "judges that, given the fragile state of the global economy, a continuation of accommodative monetary policy stance remains appropriate".

The decision to leave rates unchanged was, however, not unanimous and one of the members of the Monetary Policy Committee (MPC) voted in favor of a 0.25% rate cut, as "risks to financial stability, including volatile exchange rate and capital flows" remain a concern.

FocusEconomics Consensus Forecast panellists expect the one-day repurchase rate to end 2013 at 2.92%. In 2014, the panel expects the monetary policy rate to end at 3.20%.

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Thailand Monetary Policy Chart

Thailand Monetary Policy April 2013

Note: One-day repurchase rate in %.
Source: Bank of Thailand (BoT).

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