Bank of Thailand: Declines to Cut Interest Rate a Third Time

March 21, 2012

Thailand GDP was hit by devastating floods late in 2011, which prompted the central bank policymakers to cut their benchmark interest rate by 25 basis points at the prior two meetings on November 20 and January 25.  The rate stands at 3.0% after today’s decision not to enact a third cut.  Previously, there were nine increases of 25 basis points each from 1.25% prior to July 2010 to 3.5% in August 2011.

A new statement today concludes

The MPC assessed that the risks from the global economy had decreased and that the recovery in the Thai economy was gaining momentum. At the same time, inflationary pressure had edged up. In this context, the MPC deemed the current level of the policy rate to be appropriate in supporting economic recovery while still consistent with keeping inflation within target. The MPC, therefore, voted unanimously to maintain the policy rate at 3.00 percent per annum at this meeting.

Today’s decision had been expected by analysts.

Copyright 2012, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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