MPC expected to hold interest rate at 1.00% at its June 24 meeting, with limited prospects for a rate hike this year (Business Brief No.4275 Full Ed.)

•    KResearch expects the Monetary Policy Committee (MPC) to keep the policy rate unchanged at 1.00 percent at its meeting on June 24, 2026, to allow time to assess future inflation and economic trends, after May’s inflation rate accelerated less than projected and the 1Q26 economy continued to expand well. KResearch views inflationary pressures as largely supply-side and temporary in nature. Meanwhile, the economic outlook for 2H26 remains affected by high global energy prices, but government measures may help sustain overall growth.
•    The MPC is likely to maintain the policy rate at 1.00 percent throughout 2026, with limited scope for a rate hike. This is because the current policy rate of 1.00 percent is considered appropriate for the economic and inflation outlook. Headline inflation is projected to average 3.1 percent in 2026, peaking in 3Q26 and 4Q26 before gradually easing in 2027. This assumes that tensions in the Middle East do not escalate further, but rather begin to subside.
•    Furthermore, although the Thai economy continues to grow, the recovery remains uneven (K-shaped) and vulnerable to external risks. Raising the interest rate would further dampen domestic demand. At the same time, cutting the policy rate may have only limited effectiveness in stimulating the economy. Consequently, the MPC is likely to hold the policy rate at 1.00 percent for the rest of this year.