The Monetary Policy Committee (MPC) of the Bank of Thailand has resolved to raise the policy interest rate from 2.75% to 3% upon mounting concerns over the rising inflation.
BoT Assistant Governor for Monetary Policy Group Paiboon Kittisrikangwan announced that the MPC on 1 June 2011 had a unanimous vote for the increase of the policy inflation rate of another 0.25%. The rate adjustment was made following hikes in oil and commodity prices, which might support the continuously increasing inflation as well as drive the core inflation up to over 3 % in the third and fourth quarters of 2011.
Mr Paiboon noted that the headline inflation rate in May 2011 at 4.19% was under an estimate of the MPC. However, he said the key policy rate at 3% was the highest figure in two years and eight months, and the rate has risen for the fifth time in a row since 1 December 2010.
The assistant governor pledged that the MPC will continue keeping a close watch on pressures to the inflation in order to implement appropriate policies to cushion the situation.