Commercial banks provide deals on financial loans and savings at a money expo in Nonthaburi. File photo: Nutthawat Wichieanbut
While elevated oil prices have caused inflation to rise, economists expect the Bank of Thailand to maintain its policy interest rate for the rest of 2026, assuming the higher costs will be temporary.Wachirawat Banchuen, senior financial markets strategist at Siam Commercial Bank Financial Markets (SCB FM), said while the market believes Thai inflation has the potential to peak above 5% by the end of this year, it could decline in 2027 and return to the central bank's target range of 1-3%.
Therefore, the Monetary Policy Committee (MPC) may look to wait out the high inflation caused by a temporary uptick in energy prices, Mr Wachirawat told the Bangkok Post.
"Compared with the previous oil price crisis in 2022, when Russia invaded Ukraine, Thai inflation was as high as 6%, but the consumer price index is projected to average 3.6% this year," he said.
Thai GDP growth is weaker now, estimated at less than 2% compared with 2.6% in 2022, while current financial conditions are tighter than four years ago.
