The figure has gradually decreased from 3.5 per cent in December last year, reflecting lower consumer spending.

February's rate is close to the ministry's projection, so the government will maintain its inflation forecast for this year of 1.5 per cent to 2.5 per cent.

The ministry's permanent secretary Karun Kittisataporn said inflation was now under control.

"It is expected to remain steady, below 3 per cent, for the remaining period," he said.

Although the inflation rate is expected to decline even further, partly because of dwindling domestic consumption, the situation is not expected to harm the economy as slowing consumption will only cause economic harm if the inflation figure switches to a deficit, Karun said.

Month on month, inflation dropped by 0.4 per cent in February, mainly because of falls in prices in both the food and beverage and non-food categories.

The food and beverage category fell 1 per cent in February because of stabilising prices for fuel and consumer goods. The non-food category fell by 0.1 per cent, mainly as a result of lower electricity charges.

However, recent Bt5 increases in BTS Skytrain fares have yet to be taken in account in the ministry's inflation calculation.

Core inflation increased by 1.4 per cent year on year last month, unchanged from January. This was the result of a 4.7-per-cent increase in the cost of steel.

Petchanet Pratruangkrai The Nation