(Bloomberg) -- Thailand’s central bank Governor Sethaput Suthiwartnarueput said interest rates have reached neutral level and it’s time to hit the pause button on tightening.

If economic growth and inflation are in line with the Bank of Thailand’s expectation, then the rate will stay at the current level “for a while,” he told reporters in Bangkok on Friday. The BOT this week raised borrowing costs by a quarter-point for an eighth straight meeting to 2.50%.

His comments represent a firm guidance after the BOT’s statement on Wednesday first signaled that monetary policy was appropriate at the current level. This will help steer market expectations on the monetary policy path, amid investors’ concerns around Thailand’s loose fiscal policy leading to higher market borrowings and stoking inflationary pressures.

For now, the BOT sees inflation averaging 1.6% in 2023 and 2.6% in the next year, well within its 1%-3% target. Although it lowered gross domestic product growth forecast for this year to 2.8% from 3.6% previously, the bank 2024 GDP forecast to 4.4% from 3.8% earlier because of government stimulus policies.

“We think the economic recovery is intact and govt stimulus will also help boost growth,“ he said. “So concerns on growth has lessened.”

At neutral level, interest rates are neither loose nor restrictive of economic growth.

Prime Minister Srettha Thavisin’s cabinet has approved a raft of measures this month ranging from energy subsidy to cash handouts to drive domestic demand. Central to that plan is a 560-billion baht ($15.3 billion) spending to provide 10,000 baht each to an estimated 55 million individuals in the first quarter of 2024.

(Updates with details from the third paragraph.)

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