BANGKOK, Thailand – Thailand’s central bank on Wednesday delivered a unanimous 25-basis-point cut to its benchmark interest rate, lowering it to 1.25% from 1.50% effective immediately.
The move comes as the Monetary Policy Committee (MPC) shifts to a more accommodative stance to counter a visible economic slowdown and rising external risks.
The committee said the reduction was necessary to ensure financial conditions support a fragile recovery and to alleviate the debt burden for vulnerable households. The BOT noted that the easing would also bolster the effectiveness of various government financial measures already in place.
Economic growth projections were revised downward, with the BOT forecasting GDP expansion of 2.2% for 2025, followed by a sharper slowdown to 1.5% in 2026, before a slight recovery to 2.3% in 2027. The central bank cited a manufacturing slump and a decline in short-haul tourist arrivals as primary drags on the second half of this year.
Natural disasters have further pressured the outlook, with recent flooding in Southern Thailand expected to dampen economic activity through the beginning of next year. For 2026, the bank warned that private consumption would likely weaken as household incomes soften, while the export sector remains at risk from potential U.S. trade tariffs. (TNA)
