MNI BoT Preview-Aug 2025: May Wait For New Governor

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EXECUTIVE SUMMARY:

• Given that inflation is below the Bank of Thailand’s (BoT) 1-3% target band and growth is lacklustre and lending continues to contract, 14/23 analysts surveyed by Bloomberg are forecasting a 25bp rate cut to 1.5% on August 13. 
• However, there are also numerous reasons for it to be on hold, thus it is a close call. A new governor takes over from October 1, Vitai, and he is considered to be dovish. With policy seen as accommodative and already low it may want to retain policy space especially given elevated domestic and global uncertainties.
• If rates are left at 1.75%, it will be a dovish hold and there is likely to be at least one 25bp cut in one of the two BoT meetings left in 2025.