Macroeconomic Forecast Thailand

The Bank of Thailand (BoT) has raised its benchmark repo rate by 100bps to 2.25% since the global financial crisis amid growing confidence in the strength of the economy. Meanwhile, there have been limited signs that consumer price inflation is building up as the headline figure has actually trended lower since mid-2010, although we note that core inflation is starting to tick up. We continue to pencil in another 50bps of rate hikes this year, taking the repo rate to 2.75% by end-2011 as the BoT pre-empts inflationary pressures down the line.

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