Thai central bank keeps key interest rate unchanged, as expected
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BANGKOK, June 24 : Thailand's central bank kept its key interest rate unchanged for a second straight meeting on Wednesday, as it lifted its growth forecasts and said inflation would fall next year as supply-side pressures ease.
The Bank of Thailand's monetary policy committee voted unanimously to maintain the one-day repurchase rate at 1.00 per cent.
"Thailand's economic expansion is projected to be stronger than previously assessed but growth remains low and uneven," the BOT said in a statement.
The BOT said it expected economic growth to be 2.3 per cent this year, higher than a projection of 2.0 per cent made earlier this month, after the government announced planned extra borrowing of 400 billion baht ($12 billion). It forecast growth of 1.5 per cent at its April policy review.
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The central bank forecast 2027 growth at 1.8 per cent, versus 1.7 per cent projected in early June.
Southeast Asia's second-largest economy grew 2.4 per cent last year, lagging peers.
The surge in global energy prices meant inflation would remain high this year and ease next year as the supply-side pressures eased, the central bank said.
Headline inflation was forecast to average 2.8 per cent this year, down from a projection of 3.0 per cent made in early June and within the BOT's target range of 1 per cent to 3 per cent. Inflation was seen at 1.4 per cent in 2027.
"Despite improving developments surrounding the Middle East conflict, cost pass-through by firms warrants close monitoring amid elevated costs, as well as medium-term inflation expectations," the BOT said.
All 28 economists in a Reuters poll had expected the central bank to hold policy steady. Of those surveyed, 23 of 27 predicted the rate would remain unchanged throughout 2026, while three forecast at least one 25-basis-point hike by the year-end, and one expected a rate cut.
Six cuts between October 2024 and February had reduced the key rate by a total of 150 basis points as policymakers sought to spark Southeast Asia's second-largest economy, which has been grappling with sluggish domestic demand and high household debt.
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