According to Jinshi, Enrico Tanuwidjaja and Sathit Talaengsatya, economists at Singapore's UOB, revised their forecasts for the Bank of Thailand's interest rate path. They believe that Thailand's weak growth and inflation outlook in 2024 may prompt the central bank to start cutting interest rates as early as June. Taking into account the latest CPI data and weak demand, they now expect average inflation this year to be 1.3%, compared with 1.6% previously. Although Thailand may escape technical deflation in a few months after the expiration of government subsidies, weak underlying price pressures amid lukewarm economic activity will keep overall inflation near the lower limit of the Bank of Thailand's target range in 2024. They expect the bank to remain on hold on Wednesday while providing more signs of a policy shift, with two 25 basis point rate cuts in June and August.
