April 8, 2009
BANGKOK (AFP) - The Bank of Thailand cut the key interest rate by 25 basis points to 1.25 percent Wednesday to help spur the economy amid the global financial downturn, an official statement said.
It is the fourth cut since December as the central bank tries to boost Thailand's lacklustre economy, which is officially forecast to shrink by two to three percent this year.
Assistant bank governor Duangmanee Vongpradhip said the bank's Monetary Policy Committee decided to cut the rate because the world situation was continuing to cause a marked contraction of both major and regional economies.
"In addition, the severity and duration of the crisis remains highly uncertain, which would affect the Thai economy through contraction of exports while private domestic demand remains weak," she said in official statement.
She said that because the country's inflation was still low it allowed policymakers more room to adopt an easy monetary policy.
In an unprecedented move in December the bank slashed interest rates by 100 basis points, the steepest cut since 2000 when Thailand adopted the current inflation targeting policy.
The bank lowered the rate by a further 75 basis points in January and 50 points in February.
