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Thailand: 25bp Rate Cut To 1.75% (Consensus 1.75%) in Apr-25

• The Bank of Thailand cut the policy rate by 25bps to 1.75%, in line with market expectations, in response to increasing downside risks from global trade tensions and weaker domestic growth prospects.
• The central bank projects that Thai GDP growth could slow to between 1.3% and 2.0% in 2025, depending on tariff scenarios, while headline inflation falls below the target range, reflecting persistent disinflationary pressures.
• Future rate decisions will depend on global trade developments, domestic credit conditions, and the inflation trajectory, with monetary policy likely to remain accommodative amid heightened external uncertainty.

Colombia: 25bp Rate Cut To 9.25% (Consensus 9.5%) in Apr-25

• Banco de la República unanimously cut its benchmark rate by 25bps to 9.25%, surprising consensus expectations for no change and breaking a recent streak of unexpected holds.
• Inflation resumed its downward path, with core and headline figures easing and market-based expectations declining, supporting a measured policy loosening stance.
• While domestic demand remains resilient and growth forecasts have been upgraded, external financing conditions and fiscal uncertainty continue to pose constraints on the pace of further easing.

Indonesia: Policy Rate Held At 5.75% (Consensus 5.75%) in Apr-25

• Bank Indonesia maintained the BI-Rate at 5.75%, in line with expectations, with a cautious stance to safeguard price stability and currency fundamentals amid heightened global uncertainty stemming from US-China trade tensions.
• A resilient external position—anchored by a robust trade surplus, substantial reserves, and controlled inflation—has enabled the central bank to manage volatility while preserving policy flexibility.
• With inflation subdued and global headwinds intensifying, Bank Indonesia retains an easing bias, with future rate cuts contingent on inflation dynamics, Rupiah stability, and international capital flow conditions.

ECB: Cutting In Shadow of Shocks

• The ECB’s seventh 25bp deposit rate cut to 2.25% risks becoming stimulative, but the shock from US trade policy seen through market moves demanded a response.
• Central bankers are no more aware of the trade policy outlook than markets, but they are more aware of the potential inflationary effects and limits to effective easing.
• Time will reveal the tariffs and impact, allowing the agile ECB to tackle this rather than just the shadow it has cast on anticipatory market pricing. We still expect a June cut.

By Philip Rush