# SCB EIC forecasts that BoT will keep the policy rate unchanged at 2.5% throughout the upcoming year

- Link: https://www.thailand-business-news.com/banking/116115-scb-eic-forecasts-that-bot-will-keep-the-policy-rate-unchanged-at-2-5-throughout-the-upcoming-year
- Published: 2023-12-05T21:11:37+07:00
- Author: Economic Intelligence Center Siam Commercial Bank

The Monetary Policy Committee (MPC) has unanimously decided to maintain the policy
rate at 2.50 percent, stating that he Thai economy is showing signs of recovery,
despite a slowdown in merchandise exports and related production.

It is expected that growth will be more balanced in 2024 and 2025, supported by 
domestic demand, the tourism sector, and a recovery in merchandise exports. Inflation
is also projected to increase next year in line with the economic recovery and El
Niño-related supply pressures.

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The MPC forecasts a growth rate of 2.4 and 3.2 percent in 2023 and 2024, respectively.
The government’s digital wallet scheme is projected to contribute to a growth rate
of 3.8 percent in 2024. The overall trajectory of the economy is one of continued
recovery, marked by robust expansion in private consumption and improvements in 
employment and labor income. However, structural impediments could limit the positive
effects of global demand recovery on Thai exports.

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The MPC also projects headline inflation of 1.3 and 2.0 percent in 2023 and 2024,
respectively. This projection accounts for the digital wallet scheme, which is expected
to contribute to a 2.2 percent inflation rate in 2024. The committee is monitoring
risks from higher food prices due to El Niño and a potential increase in global 
energy prices arising from the Middle East conflicts. The MPC is also keeping an
eye on the financial system’s overall resilience and the slight tightening of overall
financial conditions. It is important to continue monitoring credit quality for 
some small and medium-sized enterprises and households with impaired debt serviceability.

[Source link ](https://www.scbeic.com/en/detail/product/9331?rand=55232)