Thailand: Further rate cuts below 0.25% are possible – Standard Chartered

Economists at Standard Chartered Bank are conservative on the economic outlook, maintaining the 2020 growth forecast at -5% (Q2: -13% y/y) and expect a further 25bps rate cut in Q3. UOB expects a contraction of more than 5% while ANZ is more optimistic and set the growth at -3.5%. USD/THB trades at 31.890.

Key quotes

“We forecast a GDP contraction of 5.0% for 2020, with a sharp contraction (-13.0%) in Q2 followed by a recovery in H2.”

“We expect another 25bps rate cut in Q3, taking the policy rate to 0.25%. We do not rule out further policy rate cuts below the 0.25% level, however. Negative rates are unlikely but not off the table.”