The Bank of Thailand expects accommodative monetary policy to remain necessary as the country’s economic recovery continues to be uneven, according to minutes from its August meeting. The Monetary Policy Committee unanimously voted to keep the one-day repurchase rate at 1% for a third consecutive meeting, citing weak and unbalanced growth.
However, policymakers warned that additional easing in the absence of a crisis could offer only limited gains compared with the potential costs. “Although policy space remained, further monetary policy easing in a non-crisis environment might yield limited additional benefits relative to its potential side effects,” the minutes noted.
With the policy rate already low by historical standards, the committee emphasized the importance of preserving room to respond to unforeseen shocks. It also highlighted downside risks stemming from the conflict in the Middle East, rising trade protectionism, and inflation pressures.