Thai inflation likely below 2.8% for 2026, policy to remain accommodative: central bank chief

[BANGKOK] Thailand’s inflation is likely to come in below the Bank of Thailand’s forecast of 2.8 per cent this year and ease in 2027, the central bank governor said on Saturday (Jul 11), adding that monetary policy would remain accommodative and focused on supporting the economy.

Monthly inflation in the fourth quarter is now expected to be less than the 4.5 per cent previously projected, and to ease in 2027, allowing the central bank to look through temporary price pressures, Governor Vitai Ratanakorn told reporters.

Headline inflation slowed to 2.42 per cent in June, remaining within the central bank’s 1 per cent to 3 per cent target range and below expectations.

Vitai said in June that there was no need to raise interest rates for now, days after the central bank left its key rate unchanged at 1 per cent. The next monetary policy review is on Aug 26.

Any further rate reductions would not be easy as the current rate level is already very low, and keeping rates too low could hurt savers and have broader negative impacts, Vitai said.

South-east Asia’s second-largest economy has been resilient, with the central bank’s 2.3 per cent growth forecast for this year seen as “not good, but not bad”, Vitai said.

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The economy expanded 2.4 per cent last year, lagging regional peers.

The central bank expects to introduce rules around October to November, requiring proof of the source of funds for deposits exceeding 5 million baht (US$150,375) to curb illicit funds, Vitai said. REUTERS