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Thailand Keeps Policy Rate Steady at 1%, as Expected

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The Bank of Thailand's Monetary Policy Committee unanimously voted to keep the policy rate unchanged at 1%, as expected by analysts, according to a Wednesday press release.

The committee said Thailand's economy is expected to slow as the Middle East conflict drives up costs, weakens household purchasing power and adds uncertainty to the outlook.

While earlier data showed stronger-than-expected growth supported by domestic demand and exports, GDP is now projected to ease to 1.5% in 2026 and 2.0% in 2027 due to war-related impacts.

Private consumption is expected to come under pressure from higher living costs and weaker incomes, while tourism arrivals may also decline. Export growth, however, is expected to remain supported by global demand for tech products. Inflation is projected to average 2.9% in 2026 before easing to 1.5% in 2027 as supply pressures fade, the central bank said.

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