National Australia Bank (NAB) is anticipating a 0.25 percentage point rate increase in July, which would bring the cash rate to an 11-year high of 4.1 per cent. This expected hike is not directly related to the recent federal Budget but rather marks the twelfth such occurrence since May 2022 and stands as the most significant increase since the Reserve Bank of Australia (RBA) began targeting cash rates in 1990.
The RBA's decision to raise rates back in May caught financial markets off guard, despite inflation easing down to 7.8 per cent by March quarter end last year.
Meanwhile, Sethaput Suthiwartnarueput, Governor of Thailand's central bank - The Bank of Thailand (BOT), has indicated that their institution will maintain a gradual and measured approach towards monetary tightening as a means of curbing inflation. Although domestic inflation returned within BOT's target range between one and three percent this past March, concerns about price pressures remain due to factors such as tourism-driven spending and political stability.
As Thailand's central bank prepares for its monetary policy review on May 31st, it remains cautious regarding potential economic recovery outpacing expectations and causing further inflationary pressures. On the other hand, with current inflation levels already within BOT’s designated one-to-two percent target band there exists an argument for ceasing additional rate increases altogether.
Governor Suthiwartnarueput encourages fiscal consolidation from government authorities while acknowledging that various political parties have pledged billions worth of incentives aimed at enticing voters ahead of general elections later this year.