Negative inflation 'to level off'
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INFLATION this quarter will remain negative, as it has all year, but the decline will be less than in the first three quarters, as food and fuel prices go up during the winter season, the Commerce Ministry reported yesterday.
The ministry projected the fourth-quarter inflation rate at minus-0.34 per cent year on year. In October, the Consumer Price Index fell for the 10th consecutive month, by 0.77 per cent year on year, on lower fuel prices.
Month-on-month inflation was negative-0.2 per cent. The CPI for the January-October period was down 0.89 per cent from the same period last year.
“Inflation could shrink less during the remaining months of the year on expected higher global oil prices driven by higher demand for fuel in the [northern] winter season, and higher food prices from the expected lower supply of some crops,” said Somkiat Triratpan, inspector-general of the Commerce Ministry and director of its Policies and Trade Strategies Bureau.
Whole year forecast
For the whole year, the ministry forecasts an inflation rate of negative-0.2-1 per cent in light of slow economic growth, lower oil prices in the global market compared with 2014, and the depreciation of the baht.
Despite all this, the ministry insists that Thailand is not yet in a deflationary situation, as consumer spending has risen.
Last month’s drop in the rate of inflation is attributed to lower fuel prices and electricity costs, as well as to some foods being cheaper.
Among the 450 products in the ministry’s inflation basket, the prices of 200 items increased in October, such as fresh fruits and vegetables, processed food, and non-alcoholic beverages, 149 items remained the same, and 101 items including fuel, shampoo and soap decreased from the previous month.
Core inflation in October, which excluded volatile fuel and food prices, was 0.95 per cent year on year and 0.04 per cent month on month. Core inflation in the first 10 months was 1.11 per cent year on year.
