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BOT Expected to Raise Rates Amid Higher Tourism Growth
BANGKOK (NNT) – The Bank of Thailand (BOT) is expected to raise interest rates by 25 basis points on Wednesday (25 Jan) to curb elevated inflation, with further hikes likely even as China’s reopening brightens the economic outlook.
While price pressures in Southeast Asia’s second-largest economy have been cooling, inflation in December was still 5.89% – well above the central bank’s 1-3% target.
BOT to raise its benchmark to 1.50%
21 of 23 economists polled by Reuters expect the BOT to raise its benchmark one-day repurchase rate by 25 basis points (bps) to 1.50% on January 25. The remaining two forecast no change.
Thailand expects 25 million foreign visitors this year
Thailand, one of Asia’s most popular tourist destinations, is expected to receive at least 5 million Chinese tourists and a total of 25 million foreign visitors this year, providing a much needed boost to an economy severely impacted by the global pandemic.
Thailand’s economy is expected to expand 3.7-3.8% in 2023
The poll showed Thailand’s economy is expected to expand 3.7-3.8% this year and next, respectively, in line with government projections.
Nearly 70% of respondents, or 15 of 22, expect another hike of 25 basis points to 1.75% by end-March. Six forecast rates at 1.5% by then, and one said it would still be at 1.25%.
The poll median showed that the central bank would then raise borrowing costs by another 25 bps, taking it to 2% by end-September.
Poll medians showed inflation would average 2.8% this year and then fall to 1.9% in 2024.
Information and Source
- Reporter : Paul Rujopakarn
- Rewriter : Tarin Angskul
- National News Bureau : http://thainews.prd.go.th
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