He thinks 1-year deposit rates could reach parity with inflation, according to an interview in today's Bangkok Post:

Moves by the central bank to tighten monetary policy and implement measures to encourage more long-term household savings will continue to put pressure on interest rates.

...

Mr Apisak said he believed the Bank of Thailand would likely continue to draw liquidity from the market and push money market rates upward through 2006, which in turn would force commercial banks to also increase rates to manage their positions.

He said Krung Thai Bank had attracted over five billion baht in new deposits over the past six months through its new four-year term deposit that pays 3.75% annually.

If Khun Apisak is correct and inflation stays at its current level of 5.6%, this would means a 350bp rise in 1-year rates by end-06. UBS expects inflation for the rest of 2005 in the 4-4.5% range, which would mean more moderate increases, but notes: "Inflationary
pressure, meanwhile, is picking up." [link: p/w required]