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Thai inflation hits 3.4 percent in July

BANGKOK (AFP) -- Thailand's inflation rate accelerated to 3.4 percent in July, official data showed Monday, fanning expectations of another interest rate hike by the central bank.

Consumer prices rose year-on-year for a 10th straight month, after a 3.3 percent gain in June, the commerce ministry said.

Core inflation, which excludes food and energy, rose to 1.2 percent in July, from 1.1 percent in June.

Last month Thailand's central bank raised its key interest rate for the first time in almost two years -- by 25 basis points to 1.5 percent -- saying the economy had remained resilient in the face of deadly political unrest.

Experts predict the Bank will tighten its monetary policy again later this year as it withdraws emergency stimulus measures, following a relatively limited impact from violent opposition street protests in April and May.

"The central bank has reasons to hike its rate as the economy is growing while its policy rate is ultra low," Capital Nomura Securities economist Nuchjarin Panarode told Dow Jones Newswires.

-- (c) Copyright AFP 2010-08-02