Thailand hikes rate for first time since 2018 to tame hot inflation



* Key rate hiked by 25 bps, as expected

* Rate rise was the first since Dec 2018

* C.bank says economy continues to gain traction

* C.bank says rate hikes to be gradual

* Sees inflation falling back to its target in 2023

By Orathai Sriring and Kitiphong Thaichareon

BANGKOK, Aug 10 (Reuters) - Thailand's central bank raised its key interest rate for the first time in nearly four years on Wednesday to counter surging inflation, signalling further gradual increases as an economic recovery gains momentum.

The Bank of Thailand (BOT), which had been among Asia's least hawkish central banks, finally joined most of its peers, raising its one-day repurchase rate THCBIR=ECI to 0.75% from 0.50% as consumer inflation hovers near 14-year highs.

Its monetary policy committee (MPC) said further hikes would be carried out "in a gradual and measured manner consistent with the growth and inflation outlook".

A director at the bank's Financial Stability Department, Don Nakornthab, said the rate was still low compared with an average of 2% over the past two decades, "so it will take a while to reach that level".

The Southeast Asian country had maintained its policy focus on supporting the economic recovery, which has lagged its neighbours due mainly to tourism curbs during the COVID-19 pandemic. The vital tourism sector has just begun to recover as restrictions were eased.

Driven by energy prices, consumer prices rose 7.61% in July from a year earlier, far above the BOT's target range of 1-3%.

The bank said it expected inflation to remain high for the rest of the year before gradually falling to its target range in 2023 as supply-side price pressures eased.

TOURISM REBOUND

The MPC voted 6-1 for the quarter point hike in the benchmark rate from the record low it had been at since May 2020.

One member voted to raise the rate by 50 basis points, saying that would reduce the risk of aggressive tightening later on and adding that such a rate increase will not significantly affect the economic recovery.

The rate was last raised in December 2018.

Seventeen of 20 economists surveyed by Reuters had expected a quarter-point hike, with the remainder forecasting a half-point rise.

"The Thai economy is projected to continue recovering with strong momentum" from higher-than-expected foreign tourism activity, Piti Disyatat, secretary of the MPC, said in a statement Link

It should return to its pre-COVID level by the end of 2022 "and will continue to gain traction", he added.

He said the BOT may revise up its 2022 economic growth forecast of 3.3% when it reviews it next month, with foreign tourist numbers expected to beat its forecast of 6 million this year.

The Thai economy expanded 1.5% last year, among the slowest in Southeast Asia.

"If inflation continues to weaken as we expect and growth struggles, the central bank will take a gradual approach to its tightening cycle. We think rates will peak at 1.5% next year," Gareth Leather of Capital Economics said.

Miguel Chanco, chief Emerging Asia economist at Pantheon Macroeconomics, said Wednesday's hike was "inevitable and long overdue" and will be followed by another 25 bps move next month.

"That said, if the MPC decides to pause in September, then a hike in November probably should be ruled out, as the inflation picture would’ve improved substantially.."



TEXT-Thai c.bank raises key interest rate



Reporting by Orathai Sriring, Kitiphong Thaichareon, Satawasin Staporncharnchai and Chayut Setboonsarng; Editing by Kim Coghill and John Stonestreet

Isenção de Responsabilidade: As entidades do XM Group proporcionam serviço de apenas-execução e acesso à nossa plataforma online de negociação, permitindo a visualização e/ou uso do conteúdo disponível no website ou através deste, o que não se destina a alterar ou a expandir o supracitado. Tal acesso e uso estão sempre sujeitos a: (i) Termos e Condições; (ii) Avisos de Risco; e (iii) Termos de Responsabilidade. Este, é desta forma, fornecido como informação generalizada. Particularmente, por favor esteja ciente que os conteúdos da nossa plataforma online de negociação não constituem solicitação ou oferta para iniciar qualquer transação nos mercados financeiros. Negociar em qualquer mercado financeiro envolve um nível de risco significativo de perda do capital.

Todo o material publicado na nossa plataforma de negociação online tem apenas objetivos educacionais/informativos e não contém — e não deve ser considerado conter — conselhos e recomendações financeiras, de negociação ou fiscalidade de investimentos, registo de preços de negociação, oferta e solicitação de transação em qualquer instrumento financeiro ou promoção financeira não solicitada direcionadas a si.

Qual conteúdo obtido por uma terceira parte, assim como o conteúdo preparado pela XM, tais como, opiniões, pesquisa, análises, preços, outra informação ou links para websites de terceiras partes contidos neste website são prestados "no estado em que se encontram", como um comentário de mercado generalizado e não constitui conselho de investimento. Na medida em que qualquer conteúdo é construído como pesquisa de investimento, deve considerar e aceitar que este não tem como objetivo e nem foi preparado de acordo com os requisitos legais concebidos para promover a independência da pesquisa de investimento, desta forma, deve ser considerado material de marketing sob as leis e regulações relevantes. Por favor, certifique-se que leu e compreendeu a nossa Notificação sobre Pesquisa de Investimento não-independente e o Aviso de Risco, relativos à informação supracitada, os quais podem ser acedidos aqui.

Usamos cookies para lhe dar a melhor experiência no nosso website. Ler mais ou alterar as configurações de cookies.

Aviso de risco: O seu capital está em risco. Os produtos alavancados podem não ser adequados para todos. Recomendamos que consulte a nossa Divulgação de Riscos.