BANGKOK: Thailand's central bank left its benchmark interest rate unchanged on Wednesday, as expected, but said there was still room to cut rates if needed as economic growth slows.
The Bank of Thailand (BOT) said it would cut its economic growth forecasts this year and next, but noted exports were poised to gradually pick up next year with the global recovery.
The BOT's monetary policy committee (MPC) voted 6-1 to hold the one-day repurchase rate at 2 percent for a fifth straight meeting. One members opted for a cut.
"The committee projects sustained economic recovery in 2015, and deems that the current monetary policy is sufficiently accommodative and does not hinder the ongoing recovery," the MPC said in a statement.
Mathee Supapongse, committee secretary, told a news conference that the central bank did not expect a big impact from the Bank of Japan's bond buying programme on Thailand and it had measures to cope with any effects.
All 19 economists polled by Reuters expected no change in the policy rate and also at its meeting in December, the last review of the year. And most economists forecast that the next move will be a rate rise, from mid-2015.
Kampon Adireksombat, senior economist of Tisco Securities in Bangkok, said: "We still expect a flat rate until the first half of 2015.
In our view, the Thai economy is unlikely to see a technical recession and hence we see a very low chance of a rate cut."
The main rate has been at 2 percent since March, when it was cut by 25 basis points to help business activity.
The military seized power in a May coup, saying it needed to restore order and get Southeast Asia's second-largest economy moving again.
The central bank said it would cut its economic forecasts for 2014 and 2015 from 1.5 percent and 4.8 percent, respectively, when it meets next month.
The economy avoided a technical recession in April-June but still shrank 0.1 percent in the first half due to political unrest and poor exports.
Recent data showed the economy is in a spotty recovery, with annual exports unexpectedly rising in September but factory output and car sales still falling.
Soft global demand and lower commodity prices have hurt Thai shipments, while private consumption, which makes up half of the economy, remains weak as households are heavily indebted.
The baht lost as much as 0.3 percent to 32.755 per dollar, its weakest since June 3 after the central bank announcement.
The currency has lost 1.5 percent since a recent peak on Oct. 21.
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