Bank of Thailand Interest Rate Kept at 2.75%

April 3, 2013

Thailand’s central bank interest rate has been at 2.75% since a string of three 25-basis point cuts in November 2011, January 2012 and October 2012.  This level remains a full 1.5 percentage points above the Great Recession trough of 1.25% that prevailed from August 2009 until July 2010.  Nine subsequent hikes were administered to a peak at 3.5% from August 2011 that only lasted for three months.  Today’s decision to keep 2.75% drew a single dissenter in favor of a 25-bp cut.  The previous policy meeting on February 20th also saw a single dissenting vote cast.

In a statement released today, some moderation of economic growth is predicted along with in-target inflation.  Officials warn of global economic risks and identify possible upward price pressures from “supply constraints and higher labor costs ….. Given the fragile state of the global economy, a continuation of accommodative monetary policy stance remains appropriate. However, risks to financial stability, including volatile exchange rate and capital flows, are a concern.”

The next monetary policy meeting in Thailand is scheduled for May 29.

Copyright 2013, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



Comments are closed.