The Bank of Thailand left its policy rate unchanged on Wednesday for the fourth consecutive meeting, as widely expected. The monetary policy committee unanimously voted to keep the one-day repurchase rate at 1.00%. A Reuters poll showed that all 26 economists surveyed had anticipated no change. Most economists surveyed forecast that the central bank would maintain that rate through the end of 2027.
The central bank said the current policy rate was suitable for supporting economic recovery. The central bank attributed a temporary rise in inflation to supply-side factors. The committee said monitoring would continue on inflation prospects, associated risks and the consequences of low rates for long-term macro-financial stability.
The central bank projected economic growth of 2.4% this year, up from the 2.3% forecast issued in June. The central bank raised its 2027 growth projection from 1.8% in June to 2.1%. However, the central bank said overall growth remained below potential. Thailand, Southeast Asia's second-largest economy, recorded annual growth of 1.9% in the second quarter this year, sharply below the previous quarter's 2.8%. Last year's growth of 2.4% was weaker than growth among regional peers.
The next central bank rate meeting is scheduled for December 23. The baht showed little movement following the decision. Many central banks, including the Philippines' central bank, have increased rates in response to inflation pressures associated with the Middle East war. However, Thailand has maintained the same policy rate since the conflict began.
The central bank reduced its policy rate six times between October 2024 and February 2026, cutting a total of 150 basis points to support the economy. Thailand's economy has struggled with weak domestic demand and elevated household debt. Deputy Governor Piti Disyatat said in an interview earlier this month that monetary policy would stay accommodative for now. Piti said the policy rate would return to normal only when the economy was ready.
Annual headline inflation accelerated to 2.82% in September but remained within the central bank's 1% to 3% target range. The central bank now projects headline inflation of 2.1% this year, below the 2.2% forecast earlier this month and June's 2.8% projection. The central bank expects headline inflation of 1.3% in 2027, down from the 1.4% forecast in June.
Thai Central Bank Maintains 1.00% Policy Rate Amid Economic Recovery
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Summary
The Bank of Thailand held its policy rate steady at 1.00% for the fourth straight meeting, in line with all 26 economists' expectations. It said the current regulatory policy is still ideal for supporting economic recovery, pointing to supply-side factors for higher inflation. The central bank raised its 2026 growth forecast to 2.4% from 2.3% in June, but noted growth is still below potential. The next rate decision is on December 23. The central bank also emphasized efforts under CFT (Countering the Financing of Terrorism) to ensure financial system integrity.
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