September 1, 2008
Bangkok - Commerce ministry yesterday announced the inflation rate plunged from its 10-year high to 6.4% in August because of decreasing world petrol prices.
July’s inflation rate was 9.2 percent.
"The drop is because of a sharp fall in oil prices, as well as a fall in utility prices such as water, power and public transport," said Siripol Yodmaungcharoen, permanent secretary of the commerce ministry.
Significant drop in the cost of living was supported by the government’s stimulus measures starting at the beginning of August.
Measures cover tax cuts, free bus and train services, and public utility price slashing.
However, food prices rose 1.7% while prices in other sectors decreased 6.2%. Domestic fuel prices fell 15%.
2008 inflation projection was revised up from 5.0-5.5 to 6.5-6.9 percent. Inflation rate averagely rose to 6.7% in the first eight months of this year.
The Bank of Thailand expected the annual inflation to remain at 7.5-8.8 percent, raising its interest rates 25 basis points to 3.75% last week.
September’s inflation was expected to rise more due to bus fare hikes and expressway toll fee increase.
