THAILAND’S central bank slashed its key interest rate by 25 basis points on Wednesday, marking the first cut in more than four years and a move long encouraged by the government to shore up a sluggish economy.
The Bank of Thailand’s monetary policy committee voted 5-2 to reduce the oneday repurchase rate to 2.25 per cent, after the rate had been hiked to a decade-high of 2.5 per cent since September 2023.
The decision came as the Southeast Asian country’s headline inflation remained below the lower end of its target range of 1 per cent to 3 per cent and is expected to gradually return to the target range by the end of 2024, the central bank said in a statement.
Secretary of the policy committee Sakkapop Panyanukul said most members voted to cut the policy rate to ease the debt burden on borrowers, adding that the lower policy rate would not hinder debt deleveraging given the anticipated slowdown in loan growth and would remain neutral and aligned with the economy’s potential.
Xinhua
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