Thailand raises policy interest rate by 25 basis points

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From The Nation

The Monetary Policy Committee (MPC) of the Bank of Thailand on Wednesday voted unanimously to raise the policy rate by another 25 basis points, from 1.50% to 1.75% per annum, with immediate effect.

MPC secretary Piti Disyatat said the committee came to the conclusion that a policy rate hike was needed to tame inflation and bring it within the target range of the central bank.

Piti said the MPC saw the rate hike as necessary, taking into account range the continual expansion of the Thai economy, driven by the tourism sector and consumption by the private sector, and signs of the export sector rebounding.

The MPC expected headline inflation to be within the target range by the middle of this year, as core inflation was still high due to high manufacturing costs and the high prices of raw materials for the manufacturing sector.

The MPC sees headline inflation returning to the target of 2.9% from the middle of this year and slide further to 2.4% next year in line with the easing oil and electricity prices.

The MPC also expected core inflation to slide to 2.4% this year and to 2% next year.

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