Bank of Thailand Maintains Policy Rate at 1% Amid Economic Growth Concerns
The Monetary Policy Committee has unanimously decided to keep the policy interest rate at 1.00%, citing uneven economic recovery and persistent challenges for SMEs.
On October 28, 2026, the Monetary Policy Committee (MPC) of the Bank of Thailand announced a unanimous decision to maintain the policy interest rate at 1.00% per annum. According to Don Nakornthab, secretary of the MPC, the current rate is deemed appropriate to support a recovery that remains uneven across different sectors of the Thai economy.
The committee projects GDP growth of 2.4% for 2026 and 2.1% for 2027. While exports and investments in technology and artificial intelligence are providing better-than-expected momentum, the committee noted that these benefits are concentrated in specific industries. The broader economy continues to grow below its potential, hindered by high household debt and fragile purchasing power among low-income earners.
For residents and travelers, the report highlights ongoing economic pressures. Small and medium-sized enterprises (SMEs) are struggling with intense competition and adaptation difficulties. Furthermore, the committee warned that rising oil prices and the El Niño phenomenon could drive inflation higher, potentially impacting the cost of living and tourism trends. While the committee expects headline inflation to average 2.1% for the year, the outlook remains sensitive to global energy prices. It remains to be confirmed how these inflationary pressures will affect consumer prices and the long-term stability of the tourism sector in the coming months.
