Thailand: Bank of Thailand keeps one-day repurchase rate unchanged at 1.50% in February
February 8, 2017
At its 8 February monetary policy meeting, the Bank of Thailand (BoT) unanimously decided to keep the one-day repurchase rate at 1.50%, as market analysts had expected.
The BoT stated that the Thai economy has been growing faster than it had foreseen on the back of the gradually improving performance of the domestic economy. Inflation has continued to increase, supported by accommodative monetary conditions.
Activity in Thailand has been encouraging over the last weeks. The export sector has continued on its upward trajectory and the tourism sector has recovered faster than expected. Regarding domestic demand, private consumption and private investment are gradually picking up, while public expenditure continues to boost the economy. Going forward, the BoT highlighted looming external risks such as the implications of the new U.S. administration on trade and the global economy in general, financial stability in China and political uncertainties in Europe.
Regarding price developments, in December, inflation moved back to the target band of 1.0% to 4.0% for the first time since December 2014. However, the Bank pointed out that core inflation remained broadly steady, reflecting that inflationary pressures from the demand side remain subdued. Against this backdrop, the Monetary Policy Committee reiterated that monetary policy should remain accommodative to support domestic activity, while ensuring financial stability.
The next Monetary Policy Committee meeting is scheduled for 22 March.