Thailand May Deliver Bigger Rate Cut to Curb Baht, Citi Says

Thailand’s central bank could deliver a larger interest-rate cut in October as officials are under pressure to take quick and strong measures to curb the strengthening baht, according to Citigroup Inc.

The baht has surged almost 6% this year, prompting officials to consider options to curb its rally including a to reduce the precious metal’s impact on the currency. Citi is recommending investors buy dollars against the baht.

“The intensity of verbal intervention indicates to us that there is likely to be some action from policymakers in the next few weeks,” analysts Rohit Garg and Gordon Goh wrote in a note Thursday. “We believe the Bank of Thailand would ease the policy rate by 25 basis points, but the risk is of a bigger cut.”

Citi joins Standard Chartered Plc . in seeing the possibility of a larger rate cut as falling tourist arrivals and higher US tariffs damp the growth outlook. Prime Minister Anutin Charnvirakul , who took office this month, has pledged to urgently address concerns over the baht’s strength.

Vitai Ratanakorn , who will take over as Bank of Thailand’s new governor next week, is scheduled to chair a meeting of the Monetary Policy Committee on Oct. 8.