Bank of Thailand Expected to Cut Rates to 1.5% by 2025: Capital Economics

The Economic Outlook for Thailand: Interest Rate Cuts Ahead

According to Jinshi Data, the future of Thailand's economy is being closely monitored as Capital Economics forecasts that the Bank of Thailand will implement interest rate cuts in the coming months. Specifically, analysts anticipate that the policy rate will decrease to 1.5% by the end of 2025.

Current Economic Conditions

Senior Asia Economist, Leather, emphasized that while there is currently a low expectation for further rate reductions in the short term, the prevailing economic challenges in Thailand coupled with low inflation present a favorable environment for additional policy easing.

Potential Rate Cuts

It is expected that the Bank of Thailand may cut interest rates by a total of 75 basis points between now and the end of next year.

Impact of the Pandemic on Recovery

Thailand's recovery from the pandemic has been notably slow in comparison to other regions. As a result, economic growth is projected to remain sluggish, with inflationary pressures continuing to stay muted.

Conclusion

In summary, the Bank of Thailand is poised for potential interest rate cuts, influenced by the sluggish recovery and economic challenges ahead. Investors and stakeholders should remain vigilant regarding central bank policies as they navigate these uncertain economic waters.

Key Takeaways

• Anticipated interest rate reduction to 1.5% by end of 2025
• Possible rate cuts totaling 75 basis points
• Slow economic recovery post-pandemic
• Low inflation rates providing conditions for policy easing