Bank of Thailand

February 3, 2016

Thailand’s Monetary Policy Committee engineered seven reductions of its policy interest rate (each by 25 basis points) beginning in November 2011 and most recently in April 2015.  Cuts in March 2015 and April 2015 were decided by split 4-3 and 5-2 votes.  The latest committee policy meeting ended in a unanimous decision to keep the interest rate steady at 1.5%, which officials believe connotes an accommodative stance despite negative inflation, and the release of a statement that’s dovish in tone.  Inflation is projected to trend back into the black, but risks surrounding the forecast have become more skewed to the downside.  The statement talks about preserving “policy space” but also “being mindful of risks to financial stability.”

And it concludes, “the Committee will continue to monitor economic and financial developments closely, and stand ready to utilize an appropriate mix of available policy tools in order to support the economic recovery, while ensuring financial stability.”

Copyright 2016, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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