BOT remains on inflation vigil
The Bank of Thailand conceded yesterday that inflation remains a risk for the rest of this year after relatively high inflationary pressure in August.
"The figures for August clearly indicate heightened inflationary pressure for both headline and core inflation. If the economy expands well, as expected, there will be more pressure to pass through manufacturing costs to product prices," said BOT Deputy Governor Atchana Waiquamdee.
Headline inflation rose to 4.29 per cent in August, up from 4.08 per cent in July, according to the Commerce Ministry. Core inflation, which excludes fresh food and fuel prices, jumped to 2.85 in August, up from 2.59 per cent in the previous month.
In the latter half of this year, the Thai economy is expected to see improvement, reflected in the high exports in July, even though the second-quarter figure slowed down because of supply disruption following Japan's tsunami disaster. Domestic politics is more stable and that could attract investment. Besides, the government's policies will likely give an economic boost in the future.
She said it was too soon to assess the impact of the government measures on inflation as the full details were not available yet.
"Now might be a good time to implement the wage increase as the current minimum daily wage is about Bt215. Some [manufacturers] may pay higher than Bt250. The labour market is starting to face a shortage. The wage increase may not affect costs much," Atchana said.
