Bangkok: Banks and research centers are in consensus that the Monetary Policy Committee (MPC) will likely maintain the policy interest rate at 1% during its upcoming meeting on June 24, as the government assesses the impact of recent economic stimulus measures.
According to Thai News Agency, financial market analysts and economic research institutions have suggested that the current interest rate may represent the lowest point in this cycle, with a high likelihood of remaining unchanged until 2026. Inflationary pressure is expected to slow in line with energy prices, keeping it within a manageable range.
Mr. Piriyapol Kongvanich, strategist at Bualuang Securities Public Company Limited, has indicated that the MPC's decision to hold the rate at 1% is aimed at preserving policy space, following the government's recent stimulus initiatives. The committee will continue to monitor the effectiveness of these measures in supporting economic recovery.
The MPC is also expected to keep a close watch on inflation trends, particularly after a decrease in energy prices due to eased tensions in the Middle East. This development could help alleviate inflationary pressures. Furthermore, the Kasikorn Research Center anticipates the MPC will maintain the 1% interest rate as May's inflation figures were lower than expected, and the first quarter of 2026 showed strong economic growth.
Projections for 2026 indicate an average headline inflation rate of 3.1%, with peaks in the third and fourth quarters before potentially slowing in 2027, assuming geopolitical tensions remain stable. The Thai economy, while expanding, shows a K-shaped recovery with vulnerabilities to external risks. Therefore, any adjustments to the interest rate could have limited benefits or adverse effects on domestic demand.
The Global Markets Group of Bank of Ayutthaya Public Company Limited also concurs with the expectation of maintaining the interest rate at 1%, given the predominance of supply-side inflationary pressures and existing economic risks. Thus, any potential rate hikes would only be justified if inflation significantly exceeds the target range in the near future.