BANGKOK: Thailand’s disinflation continued in December for the 12th consecutive month as local fuel and food prices remained weak, the Commerce Ministry said Monday.
The country’s headline inflation dropped 0.85% in December from the previous year, compared with a 0.97% year-over-year decline in November, according to the ministry’s latest report. On a sequential basis, Thailand’s headline consumer-price index edged 0.39% lower.
Thailand’s December CPI readings are lower than the median forecasts of a 0.785% year-over-year fall and a 0.30% month-over-month drop by a Wall Street Journal poll of economists.
Thailand’s headline inflation fell 0.9% year-over-year in 2015. Although the country’s 2015 CPI ended in negative territory, the reading is still within the Commerce Ministry’s expected range of minus 1.0% and minus 0.02%, said Somkiat Triratpan, director of the ministry’s Trade and Strategy Bureau.
Meanwhile, core inflation, which excludes volatile food and energy prices, rose 0.68% in December from a year ago, but inched down 0.02% from the preceding month. The poll of economists showed a median forecast of a 0.75% year-over-year rise and a 0.05% month-over-month increase. Thailand’s core CPI rose 1.05% in 2015 from 2014.
“Disinflationary pressures will likely persist into early 2016 on account of structurally lower oil prices and soft domestic demand,” ANZ Research economist Weiwen Ng said in an email. “Amid negative output gap and benign inflation, we believe that Thailand will still have room to absorb inflationary impact from weakened Thai baht.” Mr. Somkiat of the Commerce Ministry said Thailand’s inflation should rise 1.0% to 2.0% this year.
