Policy rate cut likely: SCB
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Bank of Thailand may opt to cut the policy rate at the last meeting in December, despite inflation spike in October, according to Siam Commercial Bank's research unit.
In a research note, the Economic Intelligence Unit explained that high inflation should be temporary, as the manufacturing sector should pick up after the water recedes and more output will ease price hikes.
"Under this circumstance, the central bank's policy may be biased towards economic growth than inflation," it said.
In the latest inflation report released on Oct 28, the central bank also foreseed an easing in inflation in the first half of 2012.
A rate cut is very likely if floods hit the inner city of Bangkok or inundate more industrial estates, the unit said.
The policy rate is 3.50 per cent.
