Thai central bank keeps 1% floor, hints at future rate hikes

During the IMF-World Bank annual meetings in Bangkok, the Bank of Thailand's deputy governor said one outlet 1% benchmark rate reflects the country's below-potential growth and contained price pressures. He noted that the floor is historically low but will not be reduced further unless a severe shock hits the economy. Over time, the policy rate is expected to rise to roughly 1.5%-2% as inflation and the baht stabilize.

Updated inflation and growth forecasts, projected at about 2% and 2.3% respectively, will be released with the Oct. 28 rate decision. The bank also highlighted that recent floods have limited impact and that the baht remains resilient despite global energy price shocks.