Research: Deflation anticipated for 2009

By The Nation

Thailand could suffer from the deflation in 2009, as consumer prices may contract 0.9-1.7 per cent in the first half, before rising in the latter half to bring the annualised level to minus 1 to 1 per cent, according to Kasikorn Research Centre.

The low rate, compared to 5.5 per cent in 2008, is based on low oil and commodity prices amid economic recession.

Core inflation, excluding sensitive food and energy prices, is expected to be 0-1 per cent, down from 2.3 per cent in 2008.

"Though, there is little risk that Thailand would suffer from chronic deflation. Yet, to be closely monitored is the oil price movement. If violence in the Gaza Strip spreads out or is prolonged, this could push up oil price. Though oil price is not expected to skyrocket like before, but it could rise. This would exacerbate the global economic recession and it would take a long time to recovery," the research said.

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Research: Deflation anticipated for 2009

Thailand could suffer from the deflation in 2009, as consumer prices may contract 0.9-1.7 per cent in the first half, before rising in the latter half to bring the annualised level to minus 1 to 1 per cent, according to Kasikorn Research Centre.

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