Thailand: Bank of Thailand leaves one-day repurchase rate on hold in February
At its 15 February monetary policy meeting, the Bank of Thailand (BoT) unanimously decided to keep the one-day repurchase rate at 1.50%, where it has been for over two years. The latest monetary policy announcement was in line with market expectations.
The decision to keep rates on hold reflected the Bank’s view that the current monetary stance is consistent with its inflation and financial stability objectives. A lax monetary policy has created accommodative conditions in the domestic financial market, spurring growth in credit and overall economic activity. The Bank’s latest projections show that GDP growth in Q4 likely picked up steam on the back of improving overseas demand, growth in fixed investment and public spending. Faster economic activity is exerting upward price pressures, although inflation remains below the target range of 1.0%–4.0% (January: 0.8%).
Forward guidance was scant in the press statement. The BoT commented that monetary conditions will remain accommodative going forward, subject to change only if financial conditions deteriorate, as inflation remains below its target range.
The next monetary policy meeting will be held on 29 March.