Thai central bank trims rate again, bracing for economic chill from global tensions
The Bank of Thailand's monetary policy committee voted 5-2 to reduce the one-day repurchase rate from 2 per cent to 1.75 per cent, bringing borrowing costs to their lowest level in two years.
Most committee members viewed the rate cut as necessary to support the flagging economy, address downside risks, and better align financial conditions with the changing economic and inflation outlook, the central bank said in a statement.
Secretary of the policy committee Sakkapop Panyanukul said looming risks stemming from the US trade policies and potential retaliatory measures from major economies are expected to reshape the global trade, economic, and financial landscape.
'This process is only beginning and subject to high uncertainties, with the global economy likely to grow at a slower pace and the situation expected to be prolonged,' Sakkapop told a news conference.
The Thai economic growth is expected to fall short of earlier projections, with more downside risks due to uncertainty in major economies' trade policies and a decline in tourist numbers, Sakkapop said.
He noted that headline inflation is forecast to drop below the central bank's target range, mainly owing to supply-side factors such as falling global crude oil prices and ongoing government subsidies, which partly alleviate costs of living and business expenses.
The South-east Asian country's headline inflation growth slowed to 0.84 per cent in March, falling below the central bank's target range of 1 per cent to 3 per cent after staying within the range for three consecutive months. — Bernama-Xinhua
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