Thailand’s headline inflation rose to a 13-month high in May and returned to the central bank’s target range of 1% to 3% for the first time in a year, trade ministry data showed on Friday .
The consumer price index (CPI) increased in May for the second consecutive month, up 1.54% from a year earlier, following an annual rise of 0.19% the previous month, a declared the Ministry of Commerce.
This increase, higher than the forecast of 1.19% made by a Reuters poll, is the first time since April 2023 that the main rate has returned to the central bank’s target range.
May’s inflation is expected to ease pressure on the central bank to cut borrowing costs, as the government wants, when it next reviews monetary policy on Wednesday.
Most economists expect the policy rate to remain stable at 2.50%, its highest level in more than a decade, next week.
The price rise in May reflects a temporarily low base for electricity due to subsidies, and higher prices for energy and food, the ministry said.
The ministry kept its headline inflation forecast for the year between 0.0% and 1.0%. He said the CPI would likely rise more slowly in June.
“Next month, we expect an increase of 1% to 1.1%, less than in May,” Poonpong Naiyanapakorn, director of the Office of Trade Policy and Strategy, said at a press conference. .
The inflation rate is expected to remain positive for the rest of the year and is unlikely to exceed 1% in 2024, he added.
The core CPI, which excludes volatile food and energy prices, rose 0.39% year-over-year in May.
Over the first five months of 2024, the average headline CPI fell 0.13% from a year earlier, with the base rate increasing 0.42%.
