Thai central bank maintains policy rate at 1.75%

The Bank of Thailand’s Monetary Policy Committee voted 6 to 1 yesterday to maintain the policy rate at 1.75%, with one voting for a 0.25 percentage point cut.

MPC Secretary Sakkapop Panyanukul said the committee considers that monetary policy should support the economy, as the previous policy rate cuts have already provided some cushion against the prevailing risks.

He said that the Thai economy is projected to grow by 2.3% this year and 1.7% in 2026, partly due to a stronger-than expected outturn in the first quarter and economic indicators in the second.

Export growth, particularly in electronics and front-loaded goods to the US, has supported manufacturing and related service sectors, said Sakkapop, adding that the economy is, however, expected to slow down in the second half of this year, as exports become subject to increased tariffs from the US while private consumption will moderate in line with weakening incomes and consumer confidence.

Tourist arrivals are projected to slow down, while tourist revenues continue to increase due to higher spending per visitor.

The committee has assessed that the economic outlook remains highly uncertain and it stands ready to adjust monetary policy to align with the economic and inflation outlook and associated risks.