Even though our 2015 inflation projection does not include the impacts of the government policy to lower subsidies on retail oil and gas products such as liquefied petroleum gas and natural gas for vehicles, the 2.6 per cent figure is still significantly far from the proposed inflation upper target band (about 4-5 per cent for headline inflation). Therefore, we expect no change in monetary policy between now and mid-2015. The policy interest rate may increase slightly from 2.00 to 2.25 per cent in the fourth quarter of 2015.
In addition, the baht is expected to weaken next year to around 33-34 to the US dollar.
In summary, the Thai economy is expected to rebound in 2015 from the adjustment in the equilibrium of consumption and investment. However, the global economic outlook and recovery process of the US economy are currently the most important risks to the Thai economy, which needs triggering factors to pull away from the effects of the political crisis. Therefore, the development of the world economy should be closely monitored to prepare for unexpected shocks that may hinder the local economic recovery process
Even though our 2015 inflation projection does not include the impacts of the government policy to lower subsidies on retail oil and gas products such as liquefied petroleum gas and natural gas for vehicles, the 2.6 per cent figure is still significantly far from the proposed inflation upper target band (about 4-5 per cent for headline inflation). Therefore, we expect no change in monetary policy between now and mid-2015. The policy interest rate may increase slightly from 2.00 to 2.25 per cent in the fourth quarter of 2015.
In addition, the baht is expected to weaken next year to around 33-34 to the US dollar.
In summary, the Thai economy is expected to rebound in 2015 from the adjustment in the equilibrium of consumption and investment. However, the global economic outlook and recovery process of the US economy are currently the most important risks to the Thai economy, which needs triggering factors to pull away from the effects of the political crisis. Therefore, the development of the world economy should be closely monitored to prepare for unexpected shocks that may hinder the local economic recovery process
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