Inflation falls again

Inflation falls again

Inflation in June hit a 43-month low as government measures and subsidies held down prices, while fresh food prices returned to normal with better weather.

Commerce Ministry figures showed inflation based on 450 consumer items slowed for a sixth straight month in June, with prices rising 2.25% from the same month a year earlier _ down from 2.3% in May, 2.4% in April and 3.6% in December, when the rate was its highest since November 2011.

For the first six months, consumer prices were up 2.7% from the same period last year, said Vatchari Vimooktayon, the commerce permanent secretary, which was mild compared to the ministry's forecast of 2.8-3.4%.

Food and non-alcoholic drink prices rose by 3.52% year-on-year in June, particularly meat, poultry and fish prices, which were up 6.12% while egg and dairy prices rose 5.06%. Fruit and vegetable prices increased by 9.76%.

On a month-to-month basis, prices rose by 0.15% on higher costs for non-food and beverage items.

Core inflation, which excludes fresh food and fuel costs and is based on 312 products and services, was 0.88% year-on-year in June, with the first-half rate standing at 1.23%, which was within the central bank's target range of 0.5% to 3%.

Mrs Vatchari attributed the low inflation rate to relatively low crude oil prices, which averaged US$100 per barrel compared to $109.67 last year, and sluggish domestic spending without government stimulus measures.

However, she insisted Thailand has yet to see signs of deflation, where prices fall as the economy contracts, as the inflation rate remains positive.

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