Thailand’s Headline Inflation Contracts Further in January as Consumer Prices Fall for Tenth Consecutive Month
January CPI declines more sharply than expected as energy costs and government measures keep price growth below target
Thailand’s headline consumer price index fell by 0.66 percent in January compared with the same month a year earlier, marking the tenth consecutive month of negative inflation and a larger drop than analysts had forecast.
The government’s Commerce Ministry attributed the deeper contraction to lower energy prices and measures aimed at alleviating living costs, underscoring continued subdued price pressures in the Thai economy.
The actual decline exceeded the median market forecast of a 0.40 percent drop, and remained well below the Bank of Thailand’s official inflation target range of one to three percent.
While headline inflation continued to run below zero, reflecting broad downward pressure on prices, core inflation — which excludes volatile items such as energy and fresh food — rose by 0.60 percent in January from a year earlier, signalling that underlying demand-based price pressures persist in certain sectors.
Officials from the Trade Policy and Strategy Office said they expect headline inflation to remain negative through February and March before returning to positive territory in April as seasonal factors and higher fresh food prices begin to take effect.
The extended period of subdued headline inflation follows several months of weak price momentum driven by external commodity price trends and domestic efforts to support households amid slower economic growth.
Policymakers have emphasised that the negative readings do not necessarily indicate a structural deflationary spiral, pointing instead to transitory components such as energy costs and temporary relief measures.
Nevertheless, the persistent low inflation underscores ongoing challenges for Thailand’s economic recovery and monetary policymakers, who continue to monitor price developments closely as they balance the need to support growth with long-term price stability.
The government’s Commerce Ministry attributed the deeper contraction to lower energy prices and measures aimed at alleviating living costs, underscoring continued subdued price pressures in the Thai economy.
The actual decline exceeded the median market forecast of a 0.40 percent drop, and remained well below the Bank of Thailand’s official inflation target range of one to three percent.
While headline inflation continued to run below zero, reflecting broad downward pressure on prices, core inflation — which excludes volatile items such as energy and fresh food — rose by 0.60 percent in January from a year earlier, signalling that underlying demand-based price pressures persist in certain sectors.
Officials from the Trade Policy and Strategy Office said they expect headline inflation to remain negative through February and March before returning to positive territory in April as seasonal factors and higher fresh food prices begin to take effect.
The extended period of subdued headline inflation follows several months of weak price momentum driven by external commodity price trends and domestic efforts to support households amid slower economic growth.
Policymakers have emphasised that the negative readings do not necessarily indicate a structural deflationary spiral, pointing instead to transitory components such as energy costs and temporary relief measures.
Nevertheless, the persistent low inflation underscores ongoing challenges for Thailand’s economic recovery and monetary policymakers, who continue to monitor price developments closely as they balance the need to support growth with long-term price stability.
