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Bank of Thailand likely to keep rate at 1.5% for rest of year

PHATRA Securities expects the Bank of Thailand’s rate-setting committee to keep its benchmark rate at 1.5 per cent when it meets today, and likely hold that mark for the rest of the year.

Pipat Luengnaruemitchai, assistant managing director at Phatra Securities, said the current policy rate remains an accommodative fit for the needs of Thai economic growth and the country has a large surplus in its current account. There are no signs of concern for inflation, Pipat added.

However, if the economic recovery firmed up later this year and the US Federal Reserve raised its benchmark rate two or three times this year, as expected, the BOT’s Monetary Policy Committee (MPC) would be likely to follow suit, Pipat said.

He said that, assuming the MPC held fire on any rate rise, capital could flee the country. Any decision by the MPC to raise rates would hinge on a number of factors, particularly Thailand’s economic fundamentals, Pipat said.

For the baht, Pipat said the currency may strengthen to 34 to the US dollar in the short term, arising from likely foreign capital inflows into stocks and short-term bonds in emerging markets.


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Joe Miller
the authorJoe Miller
I have been living in Thailand for over 20 years, witnessing the remarkable changes the country has undergone since the Asian Financial Crisis. Throughout my time here, I have lived Phuket, Samui, Hua Hin, and Chiang Mai, but ultimately, I always find myself returning to the bustling city of Bangkok. This dynamic metropolis served as the perfect setting for me to run a software development company and teach at universities. Nowadays, I embrace the digital world, with Bangkok as my home base. My unwavering belief in the enormous potential of Thailand and its people inspired me to create Thaivest. Through this platform, I aim to help individuals from around the globe discover how to thrive and make a fulfilling living in this captivating country.

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