January inflation surges to highest level in 28 months
INFLATION continues to be in positive territory and will likely remain so throughout this year, reflecting signs of stronger Thai economic growth following higher oil prices and increased spending, the Commerce Ministry said yesterday. The ministry reported that the Consumer Price Index (CPI) continued to climb in January, increasing 1.55 per cent year on year – the highest expansion since Septem
Month-on-month inflation came in at 0.16 per cent.
“Inflation looks like remaining positive this year, with first-quarter prices expected to be up 1.7 per cent. Yet, the factors that require close monitoring include the movement of oil prices this year, the slow recovery of the global economy, and uncertainty over the trade policies of many countries,” said Pimchanok Vonkorpon, director-general of the ministry’s Trade Policy and Strategy Office.
She explained that although inflation continued to be positive, Thailand was not as such facing an inflationary period as spending power had only increased slightly following higher global oil prices, which were not expected to rise beyond an average of US$60 (Bt2,108) per barrel this year.
The global price of crude oil averaged $53.69 per barrel last month.
The CPI continued to increase in January, due largely to domestic fuel prices rising 2.57 per cent higher year on year, along with increased prices for transport, cooking gas and some foods.
The prices of some fresh foods, poultry, dining out and rental fees were higher than a year ago, as were seafood prices due to the effect of the flooding in the South on the local fishing industry, the ministry reported.
Inflation for the whole year is expected to range between 1.5 per cent and 2 per cent, Pimchanok said.
This is based on an assumption that gross domestic product will grow by 3-3.5 per cent, the baht will be in a range of 35.50 to 37.50 against the US dollar, and the price of Dubai oil will be $45-$55 per barrel.
Last month, core inflation – excluding volatile fuel and food prices – was slightly positive, at 0.75 per cent year on year and 0.07 per cent month on month.
Starting last month, the ministry adjusted the weighting for the basket of goods and services in its inflation calculations, reducing the number of items from 450 to 422.
Fifty-one items have been removed from the basket, due to their having very light weight in terms of consumers’ daily spending, or people’s behaviour having changed to using other goods or services.
They include mosquito nets, water heaters, condoms, dry batteries, flash drives, mentholated ointments, fees for processing photographs, and fees for tailoring skirts.
Twenty products have been included, including papaya salad, smoothies, handbags, electric hair dryers, diapers, face foam, and black plastic bags.
