The Bank of Thailand's (BoT) Monetary Policy Committee expected continued economic expansion with some upside risks as it raised the key interest rate last month for a sixth straight meeting, minutes of the meeting showed on Wednesday.
On May 31, the committee voted unanimously to raise the one-day repurchase rate by a quarter point to 2.00%, citing elevated core inflation.
Policy rate normalisation would be continued gradually, the minutes said, adding that real interest rates should be positive.
Despite multiple rate hikes, Thai interest rates remain low due to cuts during the Covid-19 pandemic. The central bank has pledged to gradually return them to normal levels consistent with long-term economic growth prospects.
The central bank minutes said the possibility of higher minimum wages could see pass-through of labour costs.
The BoT will next review policy on Aug 2, when some economists see a pause on rate hikes given falling inflation.
In addition, the BoT said on Wednesday that the country's headline inflation in June is expected to be low from a high base last year, but will rise later this year.