Consumer prices increase for second straight month in May
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Consumer prices increase for second straight month in May

The Consumer Price Index (CPI) rose in May for a second straight month, up 1.54% from a year earlier, the highest level in 13 months and forecast to continue gaining slowly in June.

Poonpong Naiyanapakorn, director-general of the Trade Policy and Strategy Office, said headline inflation in May rose by 1.54% year-on-year.

He said the rise was mainly based on temporary factors: a low base price for electricity, higher gasoline prices and a surge in fresh food, vegetable and egg prices.

As for other goods and services, their prices moved in a normal direction, said Mr Poonpong.

The CPI in May compared with April increased by 0.63%, with the food and non-alcoholic beverages category rising by 1.37%, driven by higher prices for fresh vegetables, chicken, eggs, pork and fresh fruit.

Some items registered price reductions, such as rice, tangerines and drinking yogurt.

The non-food and beverages category increased by 0.09%, attributed to a rise in diesel prices. However, some items declined in price, such as airfares, detergents and insecticides.

Core CPI, which excludes volatile food and energy prices, rose 0.39% year-on-year in May.

In the first five months of 2024, average headline CPI dropped 0.13% from a year earlier, with the core rate up 0.42%.

Mr Poonpong said headline inflation is expected to increase at a slower pace in June, by between 1% and 1.1% based on the low base price of electricity in May, the extension of measures to reduce the price of electricity for another four months, and the lower price of agricultural products, especially fresh vegetables, after the end of the hot season.

Entrepreneurs have limited ability to pass on costs to customers because of slow economic growth, while the adoption of trade promotion policies, particularly continuous price reductions, also support rising prices, he said.

However, the newly adjusted price of diesel (33.00 baht per litre) is higher than the same period last year.

The uncertain impact of geopolitical tensions may lead to higher oil and freight prices, consequently raising import costs, said Mr Poonpong.

The Commerce Ministry predicts headline inflation this year will fall within a range of 0% and 1.0%.

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