Bank of Thailand to Maintain Policy Rate at 1.5%

In deliberating their policy decision, the Committee assessed that the Thai economy continued to gain further traction, driven by growth in the external sector as well as the gradual improvement in domestic demand. Headline inflation was projected to rise at a gradual pace. Overall financial conditions remained accommodative and conducive to economic growth. Financial stability remained sound overall, but there were pockets of risks that might lead to the build-up of vulnerabilities in the financial system going forward. The Committee viewed that the current accommodative monetary policy stance remained conducive to the continuation of economic growth and should foster the return of headline inflation to target, although the process could take some time. Thus, the Committee decided to keep the policy rate unchanged at this meeting.

Looking ahead, Thailand’s growth outlook improved further particularly on the back of external demand while the strength of the domestic demand recovery and inflation developments must be monitored. Hence, the Committee viewed that monetary policy should remain accommodative and would stand ready to utilize available policy tools to sustain economic growth while also ensuring financial stability.