Business News Asia
The Bank of Thailand’s Monetary Policy Committee (MPC) announced a 0.25% increase in the key interest rate, raising it from 1.25% to 1.50%, effective immediately. The decision was made during the MPC’s latest meeting.
The MPC stated that a gradual and sustained normalization of monetary policy is the appropriate approach for aligning with the growth and inflation trends in the country. The increase in interest rate is aimed at curbing inflationary pressures and maintaining the stability of the economy.
Despite the ongoing global economic challenges, the Thai economy is expected to be supported by the recovery of tourism and private consumption, driven by the return of Chinese tourists. While merchandise exports may slow down this year, the MPC expects them to improve in 2024 as the global economy recovers.
Headline inflation is predicted to decline, however, core inflation is expected to remain high. Additionally, there are increasing risks of demand-side inflationary pressures due to the economic recovery.