Thailand’s headline consumer price index (CPI) unexpectedly dropped for the first time in five months, down 0.02 percent in August from a year earlier, due mainly to government subsidies, the commerce ministry said on Monday.
The reading compared with a forecast for a rise of 0.34 percent in a Reuters poll and followed July’s 0.45 percent increase.
The CPI was dragged down by government measures to lower living costs, particularly a subsidy on tuition fees and utility bills, as well as lower prices of some food items, the ministry said.
Without the measures, the headline CPI would have risen more than 1%, ministry official Wichanun Niwatjinda told a briefing on Thursday.
“If the measures are extended until December, monthly inflation will be negative until the end of the year. If not, it will be positive,” he said.
The government is likely to continue providing subsidies along with relief measures as the Southeast Asian country struggles with its biggest wave of coronavirus infections.
However, headline inflation might not reach 1 percent this year, versus a current forecast of 0.7 percent to 1.7%, Wichanun said.
In August, the core CPI index was up 0.07 percent from a year earlier, below a forecast for a 0.18 percent rise.
In the January-August period, headline CPI rose 0.73 percent from a year earlier, with the core measure of CPI up 0.23%.