FW: RHB | Thailand | Interest Rate Unchanged Despite Strong THB

 

 

 

 

Economic Research			17 August 2017
Thailand
Economic Update
Interest Rate Unchanged Despite Strong THB   The BoT’s MPC kept its benchmark lending rate (1-day bilateral repurchase rate) unchanged at 1.5% – the decision was unanimous. The committee assessed that Thailand’s growth outlook is set to improve, underpinned by firming exports, while domestic demand continued to expand at a gradual pace. However, the growth was not sufficiently broad-based.   We concur with the BoT’s upbeat economic outlook and maintain our forecast for GDP to grow 3.7% this year. Furthermore, although the elevated strength of the THB relative to regional peers may affect business adjustments, we believe that the narrowing of the gap between Thai and US bond yields – coupled with expected US interest rate hikes – would cause increased portfolio outflows. These would ease some of the pressure on the THB. Hence, we do not envisage any rate cuts at the next MPC meeting on 27 Sep and throughout the year.   Economist:  Ng Kee Chou  | +603 9280 2179
To access our recent reports please click on the links below:   10 August: Examining Thailand’s Changing Consumption Patterns 2 August: Energy The Key Driver Again As July CPI Ticks Up 2 August : June MPI Contracts Despite Strong Exports 1 August : Money Supply And Loan Growth Stable In June 21 July : Strong 2Q Growth Despite Slight Retreat In June 6 July : Central Bank Holds Rate, Lifts GDP Forecast
Economic Team
Peck Boon Soon	Chief ASEAN Economics	bspeck@rhbgroup.com		+603 9280 2163
Vincent Loo	Malaysia, Vietnam	vincent.loo@rhbgroup.com		+603 9280 2172
Ng Kee Chou	Singapore, Thailand	ng.kee.chou@rhbgroup.com		+603 9280 2179
Rizki Fajar	Indonesia, Philippines	rizki.fajar@rhbgroup.com		+6221 2970 7065
Aris Nazman Maslan	Malaysia, Vietnam	mohd.aris.nazman@rhbgroup.com		+603 9280 2184

 

 

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