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Thailand Policy Rate 2.5% (consensus 2.5%) in Jun-24

• The Bank of Thailand maintained its Policy Rate at 2.5%, with a 6 to 1 vote, reflecting a cautious approach amid structural challenges and ongoing economic uncertainties, particularly in the export sector.
• It projects economic growth at 2.6% in 2024 and 3.0% in 2025, driven by strong domestic demand, tourism recovery, and accelerated government disbursements, while structural impediments continue to weigh on export performance.
• Inflation should gradually increase towards the target range by the fourth quarter of 2024, with headline inflation projected at 0.6% for 2024 and 1.3% for 2025, necessitating careful monitoring of external and domestic factors that could influence inflation dynamics and future policy decisions.

Thailand CPI Inflation 1.54% y-o-y (consensus 1.2%) in May-24

- Thailand's CPI inflation in May 2024 was 1.54% year-on-year, higher than consensus estimates and indicative of increasing consumer demand and price pressures.
- Core CPI inflation languished at 0.39% year-on-year, but goods pipeline pressures are boosting the headline, as 3.36% PPI inflation in April 2024 demonstrates.

Thailand Policy Rate 2.5% (consensus 2.5%) in Apr-24

• The Bank of Thailand's decision to keep the Policy Rate unchanged at 2.5%, despite some members advocating for a reduction, demonstrates a cautious optimism about economic growth and structural impediments, alongside a commitment to macro-financial stability.
• Growth projections for 2024 and 2025 are supported by private consumption, tourism, and public expenditure, albeit tempered by structural challenges in exports and manufacturing, underscoring the need for comprehensive structural reforms.
• The inflation outlook remains subdued, with expectations of a gradual increase towards the target range, necessitating vigilant monitoring of external shocks and the efficacy of monetary policy in fostering an environment conducive to sustainable economic growth amid financial stability concerns.

Thailand CPI Inflation -0.77% y-o-y (consensus -0.8%) in Feb-24

- Thailand's CPI inflation in February 2024 declined by 0.77% year-on-year, close to the consensus forecast, but was the least negative outcome since November 2023.
- Core inflation slowed marginally further to 0.43% y-o-y, contrary to expectations, sustaining dovish pressure on monetary policy.