BOT maintains policy rate
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The Bank of Thailand's Monetary Policy Committee did not surprise the markets with today's decision to hold the policy rate at 3.50 per cent, following serious damage from floods and weakening in the global economy.
This is the first time in nearly two years that the MPC put the policy rate on hold. Since December 2010, the policy rate had been raised 7 times, by 25 basis points each. The decision was anticipated.
The MPC voted 6 to 1 to leave the rate unchanged. One member preferred a rate cut of 25 basis points, said Paiboon Kittisrikangwan, assistant governor.
The MPC is of the view that though inflation pressure continues to remain high on domestic demand, inflation expectation is sustained, he said.
"The current policy rate should help contain price pressure and support the economy in light of more negative factors on the global economy and unfinished consequences of the floods,"
The MPC
