The Bank of Thailand’s Monetary Policy Committee members voted 6-1 to maintain its benchmark rate at 2%, stating that “the current monetary policy remains appropriately supportive of the Thai economic recovery.”

The  committee deems prolonged political uncertainties to be the main  cause for higher  downside risks to  growth.  Financial  conditions  are  accommodative,  and  are  not  hindering domestic spending.

Growth of the Thai economy in the first quarter of 2014 is expected to contract by more than  previously  assessed from  domestic  demand.  Private  investment  and tourism have felt greater impact from political uncertainties.

Exports of goods gradually improved but could not offset the overall subdued growth. Looking ahead, the prospect for economic recovery hinges importantly on the political developments. Economic expansion this year is expected to be lower than previous assessment, and driven mainly by exports. Inflationary pressure rose in line with expectations.

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