Bangkok, Krungthai COMPASS expects inflation in 2024 to be at 1% from the downward trend in energy prices.

Krungthai COMPASS Krungthai Bank Analyze that general inflation in December 2023 was negative 0.83%, contracting for the 3rd consecutive month due to prices in the energy and fresh food categories. The price of energy shrank due to measures to reduce the cost of living of the government. and the price of crude oil in the world market decreased. Meanwhile, the price of fresh food decreased along with the price of pork and fresh vegetables. For the core inflation rate, it is 0.58%. The general inflation rate in 2023 is 1.23%, while the core inflation rate is 1.27%.

Although general inflation has continued to be negative, it is estimated that the economy has not entered a state of deflation due to

1. Measures to reduce the cost of living in energy are the main factors causing negative inflation.

2. Entrepreneurs rush to release product stocks. and/or market supply has increased in the past

Krungthai C
OMPASS estimates general inflation in 2024 to average at 1.0%, slowing down from 2023 at 1.23% from energy category prices that are likely to be lower than in 2023, adjusted downward in line with retail oil prices, both diesel and gasoline. Under the assumption that the government holds the price of diesel fuel at no more than 30 baht per liter, which is reduced from the price in 2023, averaging 32.1 baht per liter, and the price of gasoline is likely to decrease. Partly from the excise tax reduction that is expected to be extended by the government. (which will end on 31 Jan. 2024) together with the average price of crude oil in the world market for the whole year is likely to be stable. As for electricity prices, they are likely to decrease slightly. However, we must keep an eye on the risk of geopolitical conflicts. Especially in the Red Sea, which has caused freight costs to increase. Including pressure on crude oil prices to increase higher than expected.

Source: Thai News Agency