Thailand’s central bank lowered its growth forecasts as floods began overwhelming the capital of Southeast Asia’s second-largest economy, raising the odds of an interest-rate cut in the coming months.
The economy may expand 2.6 percent this year from a previous prediction of 4.1 percent, the Bank of Thailand said in Bangkok today, adding that forecasts may be lowered further in November.
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“The impact of the floods is severe and widespread, from the agricultural to the industrial sectors, and economic activities including exports, consumption and private investment are expected to slow,” Paiboon said. “If the economy slows, there is a possibility that the central bank may ease monetary policy, but it has to take inflationary pressures into account.”
