KResearch: Higher inflation expected later this year

BANGKOK, 5 May 2010 (NNT) – The Kasikorn Research Center (KResearch) predicted that the inflation rate would slow in the second quarter but with a tendency to rebound in the latter half of this year due to the recovering world economy.

According to KResearch, the inflation rate in the second quarter should not exceed 3.4%, decreasing from 3.8% in the first quarter. However, the increasing price of oil and consumer goods resulting from the continual revival of the global economy could contribute to the higher inflation later in the year.

Meanwhile, the core inflation, which excludes fresh foods and energy, is also expected to be on an uptrend. KResearch forecasted the average core inflation to exceed 1.0% in the second quarter, compared to 0.4% in the first quarter, before shifting towards the inflation ceiling of 3.0% as targeted by the Bank of Thailand at the end of this year.

In 2010, the general inflation rate should rise by 3.0-4.0% in contrast to -0.9% of last year while the core inflation might increase from 0.4% by 1.5-2.0%. The main factors are the elevation of oil and food prices.