Thailand: Bank of Thailand keeps one-day repurchase rate unchanged in December
December 16, 2015
At its 16 December monetary policy meeting, the Bank of Thailand (BoT) decided unanimously to maintain the one-day repurchase rate at 1.50% as the markets had expected.
In its brief press release, the Bank commented that the Thai economy is expected to have recovered in the final quarter of the year mainly due to an increase in public expenditure and a pick-up in tourist arrivals, especially from China. Nevertheless, the country’s external sector remains weak and a slowdown in the other Asian economies is expected to drag down exports going forward.
Regarding price developments, the Bank said that inflationary pressures continue to decline due a slower-than-projected recovery in global oil prices, thus causing the annual variation in consumer prices to remain in negative territory. The Bank also added that consumer prices will likely recover in the first half of 2016 as the base effect of high oil prices wanes. Looking forward, the BoT assessed that, “deflationary risks remain contained as demand continues to expand and core inflation is still positive.”
Author: Dirina Mançellari, Senior Economist