The MPC continued to maintain the policy rate at 2.50%; KResearch expects that the MPC will hold the policy rate at 2.50% for the entire year.

• The Monetary Policy Committee (MPC) voted 6-1 to hold the policy rate at 2.50% on August 21, 2024, unchanged from the previous meeting. The MPC continues to view the current policy rate as consistent with an economy moving towards its potential growth while fostering macro-financial stability.
• The MPC considers that the Thai economy is projected to expand as anticipated, while inflation is expected to return to the target range. However, it is crucial to monitor downside risks from private investment and consumption, as well as the potential deterioration in credit quality, which could impact overall financial conditions and the economy.
• The MPC's signal still indicates a trend of maintaining the policy rate. Therefore, KResearch continues to assess that the MPC will keep its policy rate steady at 2.50% for the entire year.
• Nonetheless, the possibility of the MPC cutting interest rates in Q4/2024 is increasing if the economic recovery going forward proves weaker than expected due to the risk from slowing domestic and foreign demand. In addition, it is crucial to monitor the clarity of the government's economic measures.
• Following the results of the MPC meeting, the Baht strengthened slightly from THB34.28/USD to THB34.20/USD while the Thai stock market rebounded slightly after a continuous increase as investors’ concerns about domestic political uncertainty eased somewhat.

Scan QR Code