Image: Reuters Berita 24 English - The commerce ministry has warned that pricing pressures will continue into the third quarter as Thailand&...
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| Image: Reuters |
Berita 24 English - The commerce ministry has warned that pricing pressures will continue into the third quarter as Thailand's headline inflation exceeded estimates to reach a nearly 14-year high in June, supporting expectations of a rate hike as early as next month.
The ministry reported on Tuesday that the overall consumer price index (CPI) increased 7.66 percent from a year ago, driven up by increasing energy prices and partly impacted by base effects.
The amount was higher than the 7.10 percent increase in May and exceeded the 7.50 percent increase predicted in a Reuters poll.
According to ministry official Ronnarong Phoolpipat, the CPI is anticipated to increase at a similar rate as the second quarter's 6.46 percent.
However, because of the strong comparison data from the prior year, he predicted that consumer prices would decline significantly in the fourth quarter.
The ministry was holding to its projection for average headline inflation of 4.5 percent this year, despite the fact that the rate of inflation was difficult to anticipate due to a number of circumstances, including a weak baht. Inflation in 2008 was 5.5 percent.
However, the central bank projects headline inflation of 6.2% for this year, exceeding its target range of 1% to 3%.
At its upcoming meeting on August 10, the central bank is generally anticipated to increase its policy rate from a record low of 0.50 percent in an effort to rein in increasing inflation.
The core CPI index, which excludes costs for energy and fresh food, increased 2.51 percent from a year earlier, above the forecasted gain of 2.37 percent and outpacing the 2.28 percent growth in May.
