The Monetary Policy Committee (MPC), unanimously voted to raise the policy rate by 0.25 percentage point from 1.00 to 1.25 percent, effective immediately.
For the third time in a row this year, the Bank of Thailand increased its benchmark interest rate by a quarter point to 1.25% on Wednesday, making it the highest level since February 2020 and helping to control inflation.
3.7% growth forecast set for 2023
According to a BoT press release, the Thai economy is projected to continue growing at 3.2 percent in 2022, 3.7 percent in 2023, and 3.9 percent in 2024.
As the number of visitors from abroad keeps increasing, the tourism industry keeps growing. The expansion of economic activity as well as a broader recovery in employment and labor income also support private consumption.
The trajectory of Thai economic growth remains largely unchanged in 2023 and 2024 as the strength of the tourism sector and private consumption will help lessen the impact of the global slowdown on the Thai export sector.
Bank of Thailand
Thai economic recovery gained traction
Tourism and private consumption will continue to be key economic drivers going forward and help alleviate the impact of global slowdown on the Thai economy, said the BoT.
Inflation on a broad basis is predicted to reach a peak of 6.3 percent in 2022’s third quarter before falling to 3.0 percent in 2023 and 2.1 percent in 2024. Due to the increase in electricity prices, headline inflation is anticipated to be higher than previously predicted for 2023, but it is predicted to return to the target range by the end of the year.
The projected core inflation rate for 2022, 2023, and 2024 is close to the previous estimate of 2.6 percent, 2.5 percent, and 2.0 percent.
About the author
Bangkok Correspondent for Siam News Network. Editor at Thailand Business News
