BANGKOK (Reuters)

Uncertainty around the Thai economy has significantly increased, primarily due to the unclear impact of potential U.S. economic policies. Minutes from the Bank of Thailand’s (BOT) monetary policy meeting on December 18 revealed that the BOT’s monetary policy committee unanimously decided to keep the one-day repurchase rate unchanged at 2.25%, following a surprise cut in October.

The committee believed it was prudent to remain steady in light of rising uncertainties. They stated, “Maintaining sufficient monetary policy space to respond appropriately at the right time was deemed essential to maximize the effectiveness of monetary policy.”

During the December review, the central bank upheld its economic growth forecast at 2.7% for 2024 and 2.9% for 2025. The minutes indicated that the committee felt the overall economy was expanding, despite a decrease in credit growth. It is crucial for the committee to monitor developments in credit quality and growth, especially in sectors experiencing slow recovery and their impact on the broader economy.

The central bank anticipates headline inflation of 1.1% in 2025, which is near the lower end of its target range of 1% to 3%. They indicated that medium-term inflation expectations remain within this target range. The next rate review is scheduled for February 26.