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Thailand raises Interest to 2.5% to curb inflationary pressures

Thailand raises Interest for the fifth time in the past eight months in an attempt to curb inflation. The Bank of Thailand said surging oil and commodity prices increase inflationary pressures.

Boris Sullivan

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Thailand raises Interest for the fifth time in the past eight months in an attempt to curb inflation. The Bank of Thailand said surging oil and commodity prices increase inflationary pressures.

Mr. Paiboon Kittisrikangwan, Assistant Governor, Bank of Thailand, has announced the outcome of the Monetary  Policy Committee (MPC) meeting today, as follows.

The global economy maintained its growth momentum.

The outlook for the US economy improved from the previous MPC meeting due to increased consumption, recovery in private sector employment, and a declining unemployment rate. The European economy expanded gradually, with core countries serving as the main growth engines. Meanwhile, Asian economies continue to  grow robustly, supported by rising domestic demand and exports.

The Bank of Thailand said surging oil and commodity prices had aggravated inflationary pressures,

The MPC viewed that unless political unrest in the Middle East becomes widespread and affects global oil supply, the current spike in oil and commodity prices will not significantly impact the continuity of global recovery. The Thai economy continues to expand steadily, supported by expansion in exports, private consumption and private investment as well as fiscal stimulus. Private consumption growth continues to be supported by high farm income and improving employment.

Private investment is underpinned by rising manufacturing production and business confidence. In light of these relatively strong fundamentals, the MPC evaluated that the current surge in oil and commodity prices would not weigh on the growth prospects of the Thai economy.

The surge in oil and commodity prices has resulted in increased inflationary pressure compared to the previous MPC meeting. Nevertheless, the MPC assessed that gradual normalization of the  policy rate remains appropriate for anchoring inflationary expectations and reducing the  risk of financial imbalances in the economy.

The MPC therefore decided unanimously to raise the policy interest rate by 0.25 per cent, from 2.25 to 2.50 per cent, effective immediately.  The MPC will, however, closely monitor inflationary pressure going forward and stands ready to take necessary action.

Deposit Rates for Individuals of Commercial Banks as of 9 March 2011
Bank Saving Fixed
3 mths 6 mths 12 mths 24 mths
Commercial Banks registered in Thailand
Bangkok Bank 0.6250 1.2500-1.3750 1.5000-1.6250 1.7500 2.2500-2.5000
Krung Thai Bank 0.6250 1.2000 1.6500 1.8000 2.6500
Kasikornbank 0.6200 1.1000-1.3000 1.4000-1.6500 1.6500-1.7500 2.2500-2.7000
The Siam Commercial Bank 0.6200 1.1500-1.4000 1.5000-1.6250 1.6000-1.7500 2.4000-2.7000
Bank of Ayudhya 0.6250 1.2500-1.4000 1.5500-1.7500 1.6500-1.8500 2.4000-2.7000
TMB Bank 0.6200-0.8700 1.2500-1.8000 1.5000 1.7500-2.7000 2.5000-2.7500
The Siam City Bank 0.6250-0.7500 1.4000-1.5250 1.6500-1.7500 1.9000 2.4000-2.6500
United Overseas Bank (Thai) Company Ltd. 0.6250 1.2500-1.4000 1.4500-1.6000 1.6500-1.9000 2.7500
CIMB THAI Bank 0.6250 1.2500 1.7000 1.9000 2.7500
Standard Chartered Bank (Thai) 0.0000-1.2500 1.2500-1.4000 1.4000-1.6500 1.6000-1.7500 2.0000-2.2500
Thanachart Bank 0.6250-0.7500 1.4000-1.5250 1.6500-1.7500 1.9000 2.4000-2.6500
TISCO Bank 0.7500-1.2500 1.7500 1.9000 2.0000 2.5000
Mega International Commercial Bank 0.6250 1.3750 1.6750 1.8500
Kiatnakin Bank 0.7500 1.9000-2.1500 2.0000-2.2500 2.6000-2.8500 2.7500-3.0000
Land and Houses Retail Bank 0.0000-1.7000 2.0000 2.2500 2.3500 2.7500
Industrial and Commercial Bank of China (Thai) 0.7500-1.2500 1.6250 1.8750 2.0000 2.3750
The Thai Credit Retail Bank 0.7500 1.7500 1.8000 2.0000 2.2500-2.500

 

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