Bank Of Thailand likely to remain on sidelines

Despite poor domestic and external growth outlooks, the Bank of Thailand is likely to remain on the sidelines. In its latest policy statement, the BoT affirmed its stance as sufficiently accommodative. 

A weaker THB lengthens period during which the central bank can remain on hold. However, if growth slows further, the risks of further accommodation will rise, in our view. 

"Given the forecast that the US Fed will not increase rates until Q1 16, as well as signs of weakness in China and the Asean countries, the BoT will continue to monitor the data for signs of weakness. The growth forecast is lowered to 2.7% for 2015, and risks to these forecasts are flagged downside, given risks of moderation in tourism and poor weather conditions", says Barclays.