BoT risk-wary, policy tightening to be gradual - minutes

BoT risk-wary, policy tightening to be gradual - minutes

The central bank kept its policy rate on hold this month and expects any future policy tightening to be gradual and dependent on data, according to meeting minutes released on Wednesday.

On Feb 6, the Bank of Thailand's monetary policy committee voted 4-2 to leave the one-day repurchase rate at 1.75% after December's hike, its first tightening in more than seven years. One member was absent.

The two dissenters favoured a 25-basis-point increase to curb financial risks and build up policy space as the economy continued to expand around its potential, the minutes said.

The MPC will next review monetary policy on March 20.

According to the minutes, the committee felt accommodative policy would remain appropriate in the period ahead and any "policy rate increase would be gradual and data-dependent".

The committee noted there were pockets of risks in the financial system that might pose vulnerabilities to financial stability in the future, the minutes said.

The committee took the view that the Thai economy continued to gain traction on the back of domestic demand despite a slowdown in external demand.

After the Feb 6 meeting, Thailand reported slightly faster-than expected fourth-quarter growth.

The central bank has forecast growth at 4.0% for this year after 2018's 4.1% expansion, the fastest in six years.

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