The headline consumer price index (CPI) in Thailand rose 1.32% in January from a year earlier, after an increase of 1.2% the month before, the Ministry of Commerce said on Thursday.
The figure was in line with a forecast rise of 1.3% in a Reuters poll and was inside the Bank of Thailand’s target range of 1% to 3% for the second consecutive month.
Core CPI was up 0.83% in January from a year earlier.
Headline inflation in February should be close to January’s level and at about 1.1% to 1.2% in the first quarter, said Poonpong Naiyanapakorn, director of the ministry’s trade policy and strategy office.
“The current inflation level is appropriate” for the economy, he said.
Bank of Thailand Governor Sethaput Suthiwartnarueput said last week that headline inflation was expected to be 1.1% this year and the current policy interest rate at 2.25% was appropriate, but the central bank was prepared to adjust it if the situation changes.
Persistently low inflation has led members of the government to call on the central bank to cut interest rates in order to support the sluggish economy.
Veteran economist Supavud Saichuea, chairman of the National Economic and Social Development Council (NESDC), added his voice to the calls this week.
The current benchmark rate of 2.25% is not accommodative to growth, Mr Supavud said on Wednesday.
Last year’s growth drivers — better-than-expected exports, a foreign investment surge and a recovery in tourism — could also be fleeting this year, he added.
“All the metrics tell me that monetary policy is way too tight,” said Mr Supavud, referring to negative loan growth and subdued inflation. The BoT will have to “reluctantly surrender to the evidence of a feeble economic recovery.”
The Bank of Thailand, which kept the policy rate steady at 2.25% in December after a surprise quarter-point cut in October, is scheduled to review the rate again on Feb 26.
The NESDC will announce official fourth-quarter gross domestic product figures on Feb 17.