Thailand cuts key rate to record low to help economy

The Monetary Policy Committee (MPC) under the Bank of Thailand (BoT) on May 20 cut its policy rate by 25 basis points to a record low of 0.5 percent, to help soften the economic impact of the pandemic and social distancing measures.

21, May. 2020

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BANGKOK, VNA - The Monetary Policy Committee (MPC) under the Bank of Thailand (BoT) on May 20 cut its policy rate by 25 basis points to a record low of 0.5 percent, to help soften the economic impact of the pandemic and social distancing measures.

This is the second time in this year the MPC has cut the key rate.

According to MPC Secretary Titanun Malikamas, members voted 4-3 to cut the policy rate.

The Thai economy is heading for recession after shrinking 1.8 percent year-on-year in the first quarter, the deepest contraction since the flood-hit fourth quarter of 2011.

The contraction has compelled the National Economic and Social Development Council to lower its economic forecast to minus 5-6 percent this year, down from 1.5-2.5 percent growth seen in February.

The Bank of Thailand earlier warned that the economy would reach a nadir in the second quarter, before improving in the third and the fourth quarters. - VNA