# SCB EIC Forecasts Two More Rate Cuts This Year, Lowering Rates to 1.25% by Year-End

- Link: https://www.thailand-business-news.com/banking/231973-scb-eic-forecasts-two-more-rate-cuts-this-year-lowering-rates-to-1-25-by-year-end
- Published: 2025-07-16T13:28:03+07:00
- Author: Economic Intelligence Center Siam Commercial Bank

**The MPC voted 6-1 to keep the policy rate at 1.75%, citing effective prior cuts,
economic slowdown risks, high uncertainty, limited policy space, and modest GDP 
growth projections for 2025-2026.**

## Policy Rate Decision and Economic Support

The Monetary Policy Committee (MPC) voted 6 to 1 to keep the policy rate steady 
at 1.75%, with one member favoring a 0.25% cut. This reflects their view that earlier
rate cuts effectively managed downside risks amid high uncertainty and limited policy
space. They stressed the importance of timing in rate adjustments and maintaining
accommodative policy to support future economic growth, particularly given the anticipated
slowdown and rising risks in the latter half of the year.

ADVERTISEMENT

## Economic Growth Projections and Risks

The MPC anticipates Thai GDP growth of 2.3% in 2025, revised upwards due to stronger-
than-expected Q1 and Q2 performance. However, growth is projected to slow later 
due to declining exports and foreign tourist arrivals, alongside competition from
imports. For 2026, growth is forecast at 1.7%. The MPC also incorporated the impact
of a THB 157 billion stimulus package and current Thailand-Cambodia tensions, though
political uncertainties remain unaccounted for.

## Inflation and Monetary Policy Outlook

Headline inflation is projected at 0.5% in 2025 and 0.8% in 2026, driven mostly 
by supply-side factors, with low risk of deflation. Credit growth has slowed due
to weaker loan demand and rising risks, especially for SMEs facing import competition.
The MPC highlighted that while monetary policy should remain accommodative, its 
effectiveness is limited under current conditions. Future rate adjustments will 
depend on credit conditions, geopolitical events, and domestic factors, with possible
cuts if financial conditions tighten broadly.

### Related**Posts**

###  󠀁[USD to THB Exchange Rate Today: Thai Baht Moves with Global Market Trends](https://www.thailand-business-news.com/banking/331689-usd-to-thb-exchange-rate-today-thai-baht-moves-with-global-market-trends)󠁿

###  󠀁[Bank of Thailand Unveils Framework to Shield Financial Sector from Illicit Activities](https://www.thailand-business-news.com/banking/328409-bank-of-thailand-unveils-framework-to-shield-financial-sector-from-illicit-activities)󠁿

###  󠀁[Tokenised Deposits vs Stablecoins: Why Thailand’s Cautious Path Differs from Hong Kong and Singapore](https://www.thailand-business-news.com/banking/321239-tokenised-deposits-vs-stablecoins-why-thailands-cautious-path-differs-from-hong-kong-and-singapore)󠁿

###  󠀁[Thailand’s economy in July saw growth, boosted by the momentum of the global technology and AI cycle](https://www.thailand-business-news.com/banking/326128-the-thai-economy-in-july-expanded-from-the-previous-month)󠁿

[Source link ](https://www.scbeic.com/en/detail/product/9828?rand=55232)