CPI to include internet and mobile costs

CPI to include internet and mobile costs

People use smartphone on BTS skytrain. Spending on WiFi and mobile phone bills as well as processed foods will be used for inflation calculation. PATTARAPONG CHATPATTARASILL
People use smartphone on BTS skytrain. Spending on WiFi and mobile phone bills as well as processed foods will be used for inflation calculation. PATTARAPONG CHATPATTARASILL

The government is including WiFi and mobile phone service fees as well as processed foods into its inflation calculation to reflect the real costs of consumers' daily spending.

Pimchanok Wornkorporn, deputy director-general of the ministry's Policies and Trade Strategies Bureau, said the Commerce Ministry is revising the way it calculates the country's inflation rate, dropping some product items and increasing the number of service items such as WiFi and mobile phone service charges.

The calculation is currently based on 450 items of products and services.

The ministry is consulting with the Bank of Thailand and related state agencies such as the National Statistical Office to maintain people's trust in the consumer price index (CPI).

The revised consumer price index is expected to be available next year.

According to Ms Pimchanok, the Commerce Ministry is maintaining its 2016 inflation forecast of 0-1% based on expected economic growth of 2.8-3.8%, assuming Dubai crude oil is within US$35-45 a barrel, and the exchange rate remains within 35-37 baht to the US dollar.

The ministry reported this month consumer prices rose for the seventh straight month in October, mainly driven by higher fuel retail prices and the vegetarian festival pulling up demand for certain fresh vegetables.

The consumer price index, based on 450 products and services, edged up 0.34% year-on-year in October after increasing 0.38% in September, 0.29% in August, 1% in July, 0.38% in June and 0.46% in May.

Core inflation, which excludes food and energy prices, edged up 0.74% on an annual basis in October.

From January through October, headline inflation was 0.06%, while core inflation was 0.74% for the same period.

According to Ms Pimchanok, the ministry is also developing a purchasing power parity index in each province so that the private sector and other government agencies are equipped with accurate information before designing assistance packages that match local consumers' need as well as a minimum daily wage.

Purchasing power parity (PPP) is a price index very similar in content and estimation to the CPI. While the CPI shows price changes over time, the PPP provides a measure of price level differences across different areas, calculated by comparing cumulative prices of collections of frequently purchased goods.

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