The Bank of Thailand raised its benchmark rate for a second straight month to 3.75 per cent on Wednesday in bid to tame fast increasing inflation in a decade.

The central bank ensured investors that, despite a tightening move, its policy remained supportive of the economic growth.

Economists said it could be central bank’s last rate rise for this year.

Prime Minister Samak Sundaravej’s government is constantly putting pressure on Governor Tarisa Watanagase to keep the loans rate on hold to keep capital market liquidity.

Thailand’s economic growth slowed more than expected in the second quarter with 5.3 per cent increased from a year earlier, down from 6.1 per cent in the first quarter.

Thai baht rose 0.6 per cent to 34.03 against the US dollar at 2:45 p.m. in Bangkok. The currency gained earlier today after Prime Minister Samak said police would not use force to break up protests calling for his resignation.