Thai central bank keeps key interest rate unchanged
Its monetary policy committee votes unanimously to maintain the one-day repurchase rate at 1%
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[BANGKOK] Thailand’s central bank kept its key interest rate unchanged for a third straight meeting on Wednesday (Aug 26), as widely expected.
The Bank of Thailand’s (BOT) monetary policy committee voted unanimously to maintain the one-day repurchase rate at 1.00 per cent. All but two of 32 economists polled by Reuters had expected the policy rate would be unchanged and 17 of 21 economists forecast it would remain that way until the end of 2027.
“The committee views that the current policy rate is appropriate to support economic recovery,” the central bank said in a statement. It said that the economy this year and next was projected to expand broadly in line with its previous assessment.
The central bank cut the policy rate six times, by a total of 150 basis points, between October 2024 and February 2026, to support South-east Asia’s second-largest economy, which has been grappling with sluggish domestic demand and high household debt.
While central banks in South Korea, Indonesia and the Philippines have already raised interest rates, Thailand has kept its policy rate unchanged since a cut in February to support the economy amid the fallout from conflict in the Middle East.
The baht was largely unchanged after the decision at 32.71 against the US dollar. The central bank cut its policy rate six times, by a total of 150 basis points, between October 2024 and February 2026 to stimulate an economy weighed down by weak domestic demand and a household debt level that one of the highest in Asia.
South-east Asia’s second-largest economy expanded 1.9 per cent annually in the second quarter of this year, down sharply from 2.8 per cent growth in the previous quarter.
At its June meeting, the central bank raised its 2026 GDP growth forecast to 2.3 per cent from 2 per cent, and projected export growth of 14 per cent and headline inflation of 2.8 per cent.
The economy grew 2.4 per cent last year, lagging regional peers. Thailand’s headline inflation rate slowed to 1.95 per cent in July and was inside the central bank’s target range of 1 per cent to 3 per cent.
The central bank’s next interest rate meeting is on Oct 28, when it is due to provide updated economic forecasts. REUTERS
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