Thailand's central bank left its key interest rate unchanged on Wednesday as policymakers see weak growth amid negative inflation.
The Monetary Policy Committee of the Bank of Thailand unanimously decided to maintain the policy rate at 1.50 percent as widely expected by economists. The rate is now at the lowest since June 2010, when it was 1.25 percent.
The bank noted that risks to growth might arise from a fragile recovery of the global economy and moderate policy divergence in advanced economies. At the same time, inflationary pressure remained low.
"In deliberating monetary policy, the Committee judged that the Thai economy would probably expand at a lower rate than previously assessed," the bank said in a statement. However, monetary conditions remained accommodative, and the policy space should be preserved, the bank said.
The bank reiterated that it stands ready to utilize an appropriate mix of available policy tools in order to support the economic recovery, while ensuring financial stability.
Krystal Tan, an Asia economist at Capital Economics, said the bank has scope to keep monetary policy accommodative with price pressure benign.
The big question is whether the government can do enough to reverse the apparent weakening of the economy at the start of the year, she said.
With the government stepping up efforts to support growth, the economist expects the BoT to keep rates steady throughout 2016.
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