Wednesday, June 1, 2011

Bank of Thailand Raises Interest Rate 25bps to 3.00%

The Bank of Thailand raises its benchmark 1-day bond repurchase rate by 25 basis points to 3.00% from 2.75%.  The Bank's Monetary Policy Committee commented that "Inflationary pressure increased more than expected following hikes in the prices of prepared foods on the back of rising costs. Inflation expectations continued to edge up,".  The Bank further commented that "There is a risk that inflation may continue to accelerate, resulting in core inflation breaching the upper end of the target band,".

The Bank of Thailand last raised the interest rate in April by 25 basis points to 2.75%.  Thailand reported core inflation of 2.48% in May, up from 2.07% in April, according to the Commerce Ministry.  Headline inflation rose to 4.19% from 4.04% in April, meanwhile the Commerce Ministry forecasts for inflation are for between 3.2-3.7%.  The Bank of Thailand has an inflation target range of 0.5% to 3.0%.


Post a Comment