Financial News: Thai Central Bank Cuts Rate By 25 Bps

Thai Central Bank Cuts Rate By 25 Bps

(RTTNews) - The Bank of Thailand reduced its benchmark interest rate by a quarter-point, as expected, to withstand the downside risks to the growth outlook amid the heightened uncertainty posed by trade policies of major economies.

The Monetary Policy Committee voted 5-2 to cut the policy rate to 1.75 percent from 2.00 percent. Two members voted to maintain the interest rate at 2.00 percent.

Previously, the bank had lowered the policy rate by 25 basis points in February. Policymakers observed that the unpredictable nature of future global trade policies continued to pose significant challenges in assessing the economic and inflation outlook going forward.

Due to global trade policies and lower foreign tourist arrivals, the Thai economy is expected to slow down.

If trade negotiations are prolonged and U.S. tariffs remain close to current lower rates, the Thai economy would grow around 2 percent in 2025, the bank said. However, if trade tensions intensify and U.S. tariffs are set at higher rates, then the domestic economy is projected to grow at around 1.3 percent this year.

At the same time, headline inflation is projected to decline below the target range largely due to global crude oil prices and government subsidies. Core inflation is forecast to remain stable and medium-term inflation expectations are well-anchored within the target range.

Nonetheless, trade protectionism and changes in the global supply chains could affect inflation outlook, the bank cautioned.

For comments and feedback: contact editorial@rttnews.com

Copyright(c) 2025 RTTNews.com. All Rights Reserved

Market News provided by RTTNews