The Bank of Thailand’s Monetary Policy Committee unanimously held the policy rate at 1.00%, judging the accommodative stance and targeted financial measures appropriate to support a recovery that remains weak and uneven while inflation is expected to rise temporarily. Over the past year, the rate was held at 1.50% in October 2025, cut by 25 basis points to 1.25% in December and by another 25 basis points to 1.00% in February 2026, and held thereafter. Growth in 2026 and 2027 is expected to remain close to previous estimates, supported by technology and artificial intelligence-related exports and investment, although these activities are import-intensive and provide limited broader benefits. Headline inflation was revised lower due to global energy prices but is projected to rise through the first quarter of 2027 on El Niño and gradual cost pass-through before returning to low levels, while medium-term expectations remain anchored within the target range. Overall credit expanded, led by large businesses, but small and medium-sized enterprise lending continued to contract and vulnerable borrowers’ debt-servicing capacity requires monitoring. The baht was volatile against the USD amid the Middle East conflict and changing expectations for U.S. Federal Reserve policy. The committee will monitor the conflict, international trade barriers and inflation risks, while viewing the current rate as appropriate for the recovery.

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