Thailand: Bank of Thailand stays put for third straight meeting
July 25, 2012
At its 25 July monetary policy meeting, the Bank of Thailand (BoT) decided to keep the one-day repurchase rate unchanged at 3.00%, in a decision in line with market expectations. The Central Bank's decision means that monetary officials have left the main monetary policy rate unaltered for three consecutive meetings, following on two 25-basis point rate cuts in November and January. The Central Bank stated that the global economy is showing sings of cooling and that a resolution of the Eurozone debt crisis remains difficult to identify. On the domestic front, the Bank acknowledged that economic growth is gradually recovering from last year's flooding, underpinned by accommodative monetary policy, strong credit growth and government stimulus measures. The Bank explained that these measures should continue to sustain private consumption and investment. Regarding price developments, monetary authorities underlined that inflationary pressures remain at bay. Officials pointed out that "with economic growth close to potential and inflation within target, the MPC deemed that the overall macroeconomic policy mix was appropriate". Finally, authorities evaluated the recent stance as "accommodative enough" in order to shore up economic growth going forward. The next monetary policy meeting is scheduled for 5 September.
Author: Ricardo Aceves, Senior Economist