June 11, 2024 05:25 GMT
MNI Bank Of Thailand Preview: June 2024: Many Reasons To Wait
The Bank of Thailand meets on June 12 and we expect it to leave rates at 2.5%, where they have been since September 2023.
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EXECUTIVE SUMMARY:
- The Bank of Thailand (BoT) meets on June 12 and we expect it to leave rates at 2.5%, where they have been since September 2023, as there has not been anything since the April meeting to drive a dovish shift. Three analysts from 23 on Bloomberg are forecasting a 25bp cut.
- BoT has numerous reasons to remain on hold rather than easing. There is significant uncertainty over the impact of government stimulus and how the global economy will develop, including when the Fed will begin its easing cycle. It is also unlikely to want to be seen as giving in to persistent government pressure to cut rates.
- Also, BoT believes that its policy rate is not holding growth back and thus while it is close to neutral there is little reason to change it. But 2 MPC members voted for rate cuts at the last two meetings and it will be seen as dovish if their number grows.
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