BANGKOK- Thailand’s central bank is expected to keep its key interest rate at a record low but will likely cut its economic growth outlook on Wednesday, as the Southeast Asian country battles a third wave of COVID-19 infections, a Reuters poll showed.
The Bank of Thailand’s (BOT) current 2021 GDP growth forecast is 3.0 percent and it had said in May growth could come in between 1 percent to 2 percent this year, depending on the country’s vaccine rollout. Thailand started its mass vaccination drive earlier this month but has had limited vaccine supply.
The latest and biggest outbreak so far has slowed an economic recovery and the state planning agency last month slashed its GDP growth forecast this year to 1.5 percent-2.5 percent from 2.5 percent-3.5 percent.
The BOT said last month the key rate might stay at the current level for one or two years.
At its last meeting, the BOT said monetary policy would remain accommodative and the limited policy room should be preserved to be used at the most effective time.
With the BOT’s limited policy ammunition, all 22 economists surveyed expect the Monetary Policy Committee to hold its one-day repurchase rate at an all-time low of 0.50 percent this week, with several seeing no policy change throughout 2022.
The central bank has kept the policy rate unchanged after three cuts in the first half of 2020, easing the effects of the pandemic on the economy.
