At the final meeting of the year on 18 December 2024, the Monetary Policy Committee voted unanimously to maintain the policy rate at 2.25 percent.
In a widely anticipated move, Thailand’s central bank opted to keep its key interest rate unchanged on Wednesday, following an unexpected cut at its last meeting in October. The Bank of Thailand’s monetary policy committee unanimously decided to maintain the one-day repurchase rate at 2.25% during its final session of 2024.
In alignment with market expectations, 28 out of 30 economists surveyed in a Reuters poll predicted the rate hold. Only two economists anticipated a 25 basis-point reduction. The median forecast suggests a potential 25 basis-point rate cut by mid-2025.
The central bank preserved its economic growth forecast for 2024 at 2.7% and projected 2.9% growth for 2025. Despite these expectations, Thailand, Southeast Asia’s second-largest economy, continues to trail behind its regional counterparts due to persistent challenges like high household debt, elevated borrowing costs, and sluggish exports. Last year, the economy grew by a mere 1.9%.
For 2024, the BOT revised its headline inflation prediction to 0.4%, down from an earlier 0.5%, falling below the 1% to 3% target range. Looking ahead to 2025, headline inflation is expected at 1.1%, slightly lower than the prior projection of 1.2%.
Finance Minister Pichai Chunhavajira reiterated on Monday his desire for further rate cuts, advocating for policy measures to bolster the economy. Meanwhile, BOT Governor Sethaput Suthiwartnarueput emphasized the necessity of a policy mix, asserting that interest rates alone are insufficient to address all economic challenges.
