Financial News: Bank Of Thailand Cuts Interest Rate Unexpectedly By

Bank Of Thailand Cuts Interest Rate Unexpectedly By 25 Bps

02/25/2026 - 02:22:00 (RTTNews)

(RTTNews) - Thailand's central bank lowered its key interest rate by 25 basis points to 1.00 percent in a 4-2 vote on Wednesday, defying expectations for no change.

"Most committee members voted to cut the policy rate by 0.25 percentage point, from 1.25 to 1.00 percent, to ensure that financial conditions remain supportive of economic recovery and to further alleviate debt burdens for SMEs and households, as well as to anchor medium-term inflation expectations amid heightened downside risks," the central bank said.

Two members of the Monetary Policy Committee voted to maintain the policy rate at 1.25 percent as they judged that the current monetary policy stance remains consistent with the economic and inflation outlook.

Policymakers assessed the economic growth is set to remain below potential and uneven across the sectors this year and next due to structural impediments and intensified competition.

"Looking ahead, downside risks to headline inflation are expected to increase relative to previous assessment in line with the downward trend in energy prices, potentially additional government measures, and limited demand-side pressures given below-potential growth," the BoT said. "Overall credit continues to contract, the baht has appreciated, and SME and household liquidity remains tight."

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