-
Policy
Policy
Exclusive interviews with leading policymakers that convey the true policy message that impacts markets.
LATEST FROM POLICY: -
EM Policy
EM Policy
Exclusive interviews with leading policymakers that convey the true policy message that impacts markets.
LATEST FROM EM POLICY: -
G10 Markets
G10 Markets
Real-time insight on key fixed income and fx markets.
Launch MNI PodcastsFixed IncomeFI Markets AnalysisCentral Bank PreviewsFI PiFixed Income Technical AnalysisUS$ Credit Supply PipelineGilt Week AheadGlobal IssuanceEurozoneUKUSDeep DiveGlobal Issuance CalendarsEZ/UK Bond Auction CalendarEZ/UK T-bill Auction CalendarUS Treasury Auction CalendarPolitical RiskMNI Political Risk AnalysisMNI Political Risk - US Daily BriefMNI Political Risk - The week AheadElection Previews -
Emerging Markets
Emerging Markets
Real-time insight of emerging markets in CEMEA, Asia and LatAm region
-
Commodities
Commodities
Real-time insight of oil & gas markets
-
Credit
Credit
Real time insight of credit markets
-
Data
-
Global Macro
Global Macro
Actionable insight on monetary policy, balance sheet and inflation with focus on global issuance. Analysis on key political risk impacting the global markets.
Global MacroDM Central Bank PreviewsDM Central Bank ReviewsEM Central Bank PreviewsEM Central Bank ReviewsBalance Sheet AnalysisData AnalysisEurozone DataUK DataUS DataAPAC DataInflation InsightEmployment InsightGlobal IssuanceEurozoneUKUSDeep DiveGlobal Issuance Calendars EZ/UK Bond Auction Calendar EZ/UK T-bill Auction Calendar US Treasury Auction Calendar Chart Packs -
About Us
To read the full story
Sign up now for free trial access to this content.
Please enter your details below.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
Real-time Actionable Insight
Get the latest on Central Bank Policy and FX & FI Markets to help inform both your strategic and tactical decision-making.
Free AccessMNI ANALYSIS: Thailand Infla Pressures To Rise On Energy Costs
--Higher Inflation And Fed Tightening To Shift BOT To Hawkish Stance
By Stuart Allsopp
SINGAPORE (MNI) - Inflation pressures are rising in Thailand and are likely
to continue doing so, putting pressure on the Bank of Thailand to shift to a
more hawkish stance. While the bank's wide inflation target band will give
policymakers significant leeway to maintain low interest rates, the balance of
risks is shifting rapidly towards tighter rather than loose monetary policy.
The rise in Thailand's headline inflation rate in April, which came in at
1.07% y/y, up from 0.79% in March, marks the fastest increase in over a year and
likely hints at further increases to come. While core CPI rose by a more modest
0.64%, the figure was still the highest in over a year.
--RATE HOLD LIKELY, UPSIDE RISKS
Analysts are unanimous in their expectations for the BOT to maintain its
benchmark interest rate at 1.50% throughout the course of 2018, inflation
remaining at the lower end of the bank's 1.0-4.0% target range. However, upside
risks are growing as the two major disinflationary forces at play over recent
years -- low oil prices and weak credit growth -- are coming to an end. As we
have seen in the past, inflation rates in Thailand can rise rapidly when oil
prices rise.
--FUEL THIRSTY
Thailand is one of the most fuel thirsty countries in the region, with
energy comprising 13.1% of total imports and just 2.7% of total exports, meaning
that net energy imports are around 8% of GDP, considerably higher than other
major net energy importers such as India, Japan and Korea. April's rise in
headline inflation was mainly driven by higher energy prices, which rose 4.7%
y/y from 3.8% y/y in March.
As the y/y increase in global crude oil prices continues to accelerate into
the middle of the year, so too will its impact on headline CPI, and if history
is any guide we should expect core CPI to follow suit. The combination of
rapidly rising oil import prices and the ongoing monetary tightening cycle by
the U.S. Federal Reserve should put downside pressure on the Thai baht and force
the BOT to adopt a less dovish stance. The BOT will next meet on May 16 with a
hold as good as guaranteed, although MNI would not be surprised to see
policymakers adopt a less dovish tone.
--MNI Singapore Bureau; +65 8233 2326; email: Asia-Editor@marketnews.com
--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com
[TOPICS: M$A$$$,MI$$$$]
To read the full story
Sign up now for free trial access to this content.
Please enter your details below.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.