The Bank of Thailand’s Monetary Policy Committee (MPC) on Wednesday voted 6-1 to maintain its benchmark interest rate at 2.00 per cent per annum.
MPC Secretary Paiboon Kittisrikangwan said the growth of the Thai economy in the first quarter of 2014 is expected to contract more than previously anticipated due to declining domestic demand.
The MPC, then, voted 6 to 1 to maintain the policy rate at 2.00 per cent.
He said, one member voted to lower the policy rate by 0.25 per cent, to sustain policy easing in supporting growth.
Mr Paiboon said private investment and tourism have felt greater impacts from political uncertainties.
Exports of goods gradually improved but could not offset the overall subdued growth.
Looking ahead, he said, 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.
The committee deems prolonged political uncertainties as the main cause for higher downside risks to growth.
Financial conditions are accommodative, and are not hindering domestic spending.
Current monetary policy remains appropriately supportive of the Thai economic recovery. (MCOT online news)
