The Monetary Policy Committee increases the policy rate for the first time in 7 years; the impact on economic growth is likely to be limited. (Business Brief No.3777)

      The Monetary Policy Committee (MPC) agrees to lift the policy rate by 0.25 percentage points from 1.50 to 1.75, the first rate increase in seven years. The lift is aimed at building policy space for the future. KResearch views that the policy rate increase is unlikely to have a significant impact on the Thai economy in 2019 as the liquidity in the Thai financial market remains high.  

      KResearch holds the opinion that the MPC is likely to maintain monetary easing policy at least through the first half of 2019. Hence, the latest rate increase is likely to be a one-off adjustment. The MPC will assess the readiness of the Thai economy in the future before deciding to raise the policy rate again, possibly in the second half of 2019.

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