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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.

Trump-ism And East Asia

• Donald Trump’s abandonment of the US-led international order and efforts to reshape global trade and finance do not bode well for East Asian economies that may find themselves forced by Washington into a Chinese sphere of influence as part of a grand bargain with Beijing.

By Alastair Newton

Thailand: 25bp Rate Cut To 2% (Consensus 2.25%) in Feb-25

• Contrary to consensus expectations, the Bank of Thailand cut its policy rate by 25bps to 2.00%, citing weaker-than-anticipated growth and rising downside risks.
• Structural weaknesses in manufacturing and heightened import competition continue to challenge economic momentum, while inflation remains subdued due to supply-side factors.
• Future policy will depend on domestic demand resilience, external trade developments, and financial stability risks, with structural constraints limiting room for further rate cuts.

Thailand: Policy Rate Held At 2.25% (Consensus 2.25%) in Dec-24

• The Bank of Thailand unanimously maintained the policy rate at 2.25%, aligning with consensus expectations, citing alignment with economic potential and inflation within target expectations.
• Economic growth projections for 2024–2025 remain steady, but uneven sectoral recovery, particularly in manufacturing and SMEs, presents ongoing risks to sustainable recovery.
• Global economic uncertainties, credit growth trends, and the efficacy of government debt-relief programmes in supporting domestic demand and financial stability will influence future policy decisions.