Consumer prices fell for a 10th straight month in October, but the Commerce Ministry is positive that prices will edge up in the rest of this year in line with higher oil and food prices.
The ministry yesterday reported that consumer prices, based on 450 products and services, fell by 0.77% year-on-year but rose by 0.2% from September thanks to a rise in prices of fresh vegetables and fruit in light of the annual Vegetarian Festival and higher finished food and retail oil prices.
From January to October, consumer prices dropped by 0.89% from the same period last year.
Core inflation, which excludes volatile food and energy prices, rose by 0.95% year-on-year in October and 0.05% month-on-month.
In the first 10 months, core inflation increased by 1.11%.
Somkiat Triratpan, director of the ministry's Office of Trade Policy and Strategy, said 200 of the 450 products and services rose in price, 101 fell and 149 were unchanged.
"Inflation, both headline and core, is expected to continue rising, especially late in the year when the weather is cool, raising demand for food and oil," he said.
The ministry is maintaining its 2015 inflation rate target at a range of -1% to -0.2% based on an economic growth projection of 2.5-3.5%, Dubai crude oil prices at US$48-58 a barrel and a foreign exchange rate of 33-35 baht against the US dollar.
Kasikorn Research Center said world oil prices were expected to see a limited increase until early next year. The trend will put further pressure on Thai inflation to stay in a negative range or very low positive range in the first half of next year.
The research house forecasts Thailand's inflation rate will slightly increase next year by 0.8-1.8% from a range of -1% to -0.8% this year based on Dubai crude oil prices of $48.5-56 per barrel.
Thanavath Phonvichai, vice-president for research at the Thai Chamber of Commerce, said higher core inflation reflected a marginal increase in consumers' purchasing power.
However, people's overall spending has yet to increase much because their new income is relatively low, he said.