Analysts Expect BOT to Cut Policy Rate to a New Low, Easing a Covid-19 Effect on Economy
Analysts Expect BOT to Cut Policy Rate to a New Low, Easing a Covid-19 Effect on Economy
Analysts Expect BOT to Cut Policy Rate to a New Low, Easing a Covid-19 Effect on Economy
19 พ.ค. 2563

Due to the upcoming policy review of Bank of Thailand on this Wednesday, several economists are highly expecting the BOT to cut its policy interest rate to a new low, mitigating the coronavirus effect on economy and businesses.
Sixteen of 18 economists have predicted the BOT’s monetary policy committee would trim its one-day repurchase rate THCBIR=ECI by 25 basis points to 0.50% – which will be the fifth reduction in borrowing costs since August, said by Reuters
The other two economists estimated the central bank will still remain the lowest rate record of 0.75%.
BOT stated on the March 25, 2020 meeting report that Thai economy would significantly contract in 2020 and headline inflation would become negative as a fallout of the Covid-19 pandemic, but the Committee voted 4 to 2 to maintain the policy rate at 0.75%, while two members voted to cut the policy rate by 0.25% point.
On Monday, the Office of the National Economic and Social Development Council (NESDC) has reported Thailand’s 1Q20 GDP contraction of 1.8%. NESDC forecasted Thailand to face a contraction in 2020 in every category. GDP will shrink by 5-6%, exports by 8% and imports by 13.52%. Meanwhile, inflation is forecasted to plugne by 0.5-1.5%.
Tourism and domestic activity were hit hardest by the social restrictions to halt the spread of the pandemic.