The Bank of Thailand’s Monetary Policy Committee unanimously maintained the policy rate at 1.00 percent, judging the accommodative stance appropriate to support the economic recovery. Growth projections for 2026 and 2027 remain broadly unchanged, with stronger exports and private investment linked to the technology and artificial intelligence cycle offset by weaker-than-expected private consumption and limited domestic spillovers. Inflation is now projected to be lower than previously assessed, mainly because of global energy prices and weaker cost pass-through. Headline inflation is expected to rise through the first quarter of 2027 due to El Niño and gradual cost pass-through before returning to low levels amid weak domestic demand. Overall credit growth has picked up, primarily through lending to large corporates, but small and medium-sized enterprise loans continue to contract. The committee called for targeted financial support for vulnerable groups and viable SMEs and will monitor Middle East tensions, trade protectionism, firms’ cost pass-through and medium-term inflation expectations.
2026-08-26Bank of Thailand
Bank of Thailand unanimously holds policy rate at 1.00 percent as growth remains low and uneven
The Bank of Thailand unanimously held its policy rate at 1.00 percent, citing low and uneven growth despite support from technology and artificial intelligence-related exports and investment. Inflation forecasts were lowered, while contracting SME lending and the repayment capacity of SMEs and vulnerable households remain key concerns.