The Bank of Thailand (BoT) raised its key policy rate by 0.25 percentage point from 1.75 to 2.00 percent, effective immediately.
Mr. Piti Disyatat, Secretary of the Monetary Policy Committee (MPC), announced the outcome of the meeting on Wednesday.
The Thai economy should continue to expand, driven mainly by tourism and private consumption. Merchandise exports are expected to recover gradually.
While headline inflation slows, core inflation remains elevated. Inflationary risks stem from greater demand pressures amid expanding economic activity and higher cost pass-through from supply pressures.
The Committee deems a continuation of gradual policy normalization to be appropriate in light of the growth and inflation outlook, and voted to raise the policy rate by 0.25 percentage point at this meeting.
The Committee projects the economic growth to be 3.6 and 3.8 percent in 2023 and 2024, respectively. A key impetus is the broad-based recovery in tourism, which should promote employment and labor income, in turn sustaining private consumption.
Merchandise exports are recovering broadly consistent with expectation, and should improve in line with a moderate expansion in the global economic activity.
The Committee recognizes upside risks to domestic growth, in part owing to forthcoming government economic policies. At the same time, there is a need to monitor the uncertain economic and monetary policy outlook of major economies.
