Thailand's Headline Inflation Increased By 0.23% During June
During the month of June, headline inflation in Thailand increased unexpectedly, but the pace of increase was one of the slowest in the last 22 months. After the data, the commerce ministry also revised the CPI forecast lower for the rest of 2023.
Overall, Thailand's CPI jumped by 0.24% during June when compared with the same period last year. For the most part, economists were looking forward to an increase of 0.1%, while the actual value turned out to be double that!
According to experts, the slow pace of increase in headline inflation is due to the low energy & food prices in the country. Collectively, these helped in bringing down the consumer prices for the general public.
After the reading, that's the 2nd month in a row that Thailand's CPI has remained within the target range of 1-3% set by the central bank.
Inflation Remains Low In Thailand
When compared with the rest of the world, inflation in Thailand is still very low, which highlights the resilience of the Thai economy.
According to the ministry, the headline CPI will increase at the rate of 0.77 YoY during the 3rd quarter. For Q4 2023, the ministry has set a forecast of 0.62%.
This means that the year-end inflation in 2023 will be between 1% - 2%, which falls under the range set by the central bank. Earlier, Thailand's central bank projected the inflation to be between 1.7 - 2.7% only.
If we look at the period between January to June 2023, the headline inflation in Thailand was 2.39%. At the same time, the core rate in Thailand was around 1.87%.
Just a few months ago, the central bank of Thailand introduced a quarter-point rate which raised the policy rate to 2%. At the next meeting in August, the chances of more rate hikes are very slim. After all, the inflation is already in the range of the Thai central bank, so there's no reason to make any adjustments to the policies.