March inflation rises 3.45% year-on-year: Commerce Ministry

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Thailand’s Consumer Price Index (CPI) stood at 114.3 in March, an increase of 3.45 percent compared to the same period last year, Yanyong Phuangrach, permanent secretary for commerce said on Tuesday.

It is considered a slight increase as the economy is recovering and reflected a sound economy as a result of the government’s economic stimulus measures and the commerce ministry’s measures to watch over the prices of necessities.

The Consumer Price Index in the first three months was up 3.39 percent, compared to the same period in the previous year, while the March CPI was 0.59 percent higher compared to the previous month due to food and beverage prices rising by 0.66 percent in parallel with higher prices of eggs, dairy products and fresh fruit.

Hot and dry weather caused less produce for the market, while other non-food items were up 0.55 percent.

Increased civil servant salaries are likely to affect Thailand’s inflation rate by 0.01 percent and the daily minimum wage when it is fully implemented is likely to impact inflation only 0.1 percent. The average inflation for the whole year is projected to rise to 3.9 percent, higher than earlier targeted at 3.8 percent.

The Ministry of Commerce projects the average inflation in 2012 to stay at 3.3-3.8 percent. Global oil prices, the world economy, natural disasters, volatile currency exchange and interest rates remain risk factors. Taxi fares rising 12 percent and higher excise tax on air conditioners are likely to impact inflation by only 0.028 percent and 0.07 percent respectively.

However, the inflation rate in the second quarter is projected to stay at 3.5 percent, which is normal for improving economy with more spending.

The volume of farm produce will decrease in summer, causing prices of goods and energy to rise. The commerce ministry will delay any consumer goods price rise for the time being, particularly for food, to help people shoulder the burden of the higher cost of living.

The core consumer price index in March rose 2.77 percent year-on-year and 0.33 percent, compared to the previous month.