Rate Hike in Thailand
August 2, 2023
In Thailand where inflation is currently also very low at 0.2% as of June, monetary officials today agreed unanimously to raise the central bank’s key interest rate by 25 basis points to 2.25%. The Bank of Thailand‘s rate had been lowered from 1.75% in August 2019 to 0.50% by May 2020 in increments of 25 basis points. Later, a cycle of rate hikes commenced in August 2022. Today’s meeting being in August, it is interesting to note that the previous and current rate cycles began in August, and all moves, down and then up, have been 25 bps in size. The inflationary backdrop to the current upward trend is that CPI inflation crested at 7.86% in August 2022 and ten months later had dropped back to a 22-month low. While expecting inflation to stay inside its targeted range, a statement released today acknowledges upside price risks such as diminishing productive slack, higher food prices, and a severed El Nino episode.
Copyright 2023, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: Bank of Thailand
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