Mr. Poonpong Nainapakhorn, Director of the Office of Trade Policy and Strategy, revealed that the Consumer Price Index (CPI) of Thailand for October 2023 stands at 108.61, compared to 107.72 in October 2022, resulting in an overall inflation rate increase of 0.83% (YoY). The main factor contributing to this rise is the increase in food prices, particularly fresh vegetables and fruits, alongside rising diesel fuel and electricity costs due to last year's low price base, which had more government energy cost relief measures than this year. Meanwhile, the price of gasohol has decreased in line with global energy market trends. Other goods and services have had a minimal impact on inflation.

 

When comparing Thailand's overall inflation rate with other countries, the latest data from September 2023 shows that Thailand's inflation rate increased by 0.61% (YoY), remaining among the countries with low inflation rates, ranking 20th out of 140 economic areas reporting figures, and 2nd in the ASEAN region among 9 countries reporting figures (Brunei, Cambodia, Malaysia, Indonesia, the Philippines, Singapore, Vietnam, and Laos).

 

The overall inflation rate increased by 0.83% (YoY) this month, with price movements of goods and services as follows:

The food and non-alcoholic beverage category rose by 1.95% (YoY) due to increases in key product prices, including fresh food items such as fresh vegetables (spring onions, cabbage, coriander, Chinese cabbage, eggplant, fresh chili, cauliflower), fresh fruits (rambutan, bananas, mangoes, watermelons, and plantains), fresh chicken, eggs, white shrimp, pork, and rice. The non-alcoholic beverage group (instant coffee, hot/cold coffee, sweetened drinks) and the cooking ingredient group (granulated sugar, dried/grated coconut, ready-made coconut milk) also saw price increases. However, several items experienced price decreases, such as grilled chicken, lemons, vegetable oil, red onions, garlic, mackerel, and delivery food.

Other categories not related to food and beverages increased by 0.04% (YoY) due to rising prices of key products, particularly diesel fuel, gasoline, and electricity costs. Additionally, housing rents, airline fares, personal service fees (men's and women's haircuts), and photocopying costs also increased. Meanwhile, several important items saw price reductions, including gasohol, personal care items (shampoo, body soap, skincare products), cleaning supplies (detergents, toilet cleaners, fabric softeners), and clothing (men's and women's t-shirts and shirts).

The core inflation rate (overall inflation excluding fresh food and energy) increased by 0.77% (YoY), remaining stable compared to September 2023, which also saw a 0.77% (YoY) increase.

The Consumer Price Index for October 2023 decreased by 0.06% (MoM) compared to September 2023, following a decline in the food and non-alcoholic beverage category by 0.11%, attributed to price drops in certain fresh vegetables such as cucumbers, kale, fresh chili, lemons, and spring onions, as well as some fruits like guavas, sweet oranges, longans, and plantains, along with fresh chicken, pork, eggs, and delivery food. However, several items saw price increases, including morning glory, cabbage, eggplant, sticky rice, dragon fruit, and mangoes. The other categories not related to food and beverages decreased by 0.03%, reflecting the drop in gasohol prices and personal care items (shampoo, conditioner, body soap, skincare products, facial foam). Items that saw price increases included cleaning supplies (detergents, ironing aids, floor cleaners), housing rents, diesel fuel, and airline fares.

The average Consumer Price Index from January to October 2023 compared to the same period in 2022 increased by 0.26% (AoA).

The overall inflation trend for November 2023 is expected to rise compared to October 2023, with key factors anticipated to drive overall inflation higher including (1) domestic diesel prices set at a ceiling of no more than 33 baht per liter, which is higher than the same period last year, (2) household electricity costs increasing due to a lower base last year, as government electricity cost relief measures this year are less than last year, and (3) prices of goods and services related to the tourism sector are expected to rise, particularly airline fares, which align with the tourism season. Meanwhile, key factors that may lower overall inflation include:

(1) Global crude oil prices are expected to remain lower than last year (in November 2023, the average was above $80 per barrel, while currently it is around $70 per barrel), leading to a decrease in gasohol prices. (2) Fresh vegetable prices returning to normal levels as the temporary impacts of flooding in some areas have ended. (3) Anticipated continued marketing promotions by major wholesale and retail traders.

The Ministry of Commerce continues to forecast the overall inflation rate for 2023 to be between 0.2% and 0.8% (with a median of 0.5%), which is consistent with the current economic situation, and if there are significant changes, a review will be conducted.

The overall consumer confidence index for October 2023 increased to 52.9 from 51.6 in the previous month, marking the second consecutive month of increased confidence. The current consumer confidence index rose to 44.8 from 43.1, while the future consumer confidence index (three months ahead) increased to 58.3 from 57.2. The reasons for this increase are believed to stem from (1) the implementation of policies to urgently address economic and social issues, particularly government economic stimulus measures (10,000 baht digital cash) that promote domestic consumption, (2) good export growth in response to increased demand for agricultural and food products, and (3) gradual reductions in commercial bank interest rates in line with policy interest rates, easing financial concerns for the public. However, the global economic slowdown, reflected in ongoing trade wars and persistent geopolitical issues, along with Thailand's high household debt levels, remain pressing factors to monitor closely.