The Bank of Thailand (BOT) has confirmed that key interest rates would continue to climb until the economy reaches its full potential and inflation returns to the target level, with gradual policy normalization remaining appropriate.
In a statement published for an analysts’ meeting, the central bank stated that global monetary tightening has had a minimal influence on the nation’s financial circumstances.
The forecast for Thailand’s economy and inflation has been consistent with projections, but the BOT has stated that it is willing to modify the pace of future rate rises if the outlook changes.
Piti Disyatat, Assistant Governor of the BOT, informed the gathering that the economy is likely to completely recover in the second half of 2023, with inflation returning to the target range of 1-3%. He also stated that the rate committee will select the terminal rate in the second half of 2023 dependent on the economy.
Since August, the BOT has lifted its key rate by 75 basis points in three sessions, from a record low of 0.5%. It will review policy again on January 25, when economists anticipate another increase.
The assistant governor also stated that the slowing global economy should not have a significant influence on foreign visitor numbers because the majority of them come from Asia, where economies are still doing well.