Thailand's inflation is expected to remain low in the first half of this year, parving way for further rate cuts, said Siam Commercial Bank's economic centre.
The Economic Intelligence Centre said that though headline inflation has been on the rise in the past three months, but it was attributable mainly to the prices of ready-to-eat food products. The prices rose mainly on the higher cost of raw materials and cooking gas, rather than because of domestic demand.
"The low inflation poses no obstacle if the Bank of Thailand would lower the policy rate to boost the economy," it said.
The centre expected headline and core inflation to be at 2.5 per cent and 1.4 per cent, respectively, in 2014.
The figures picked up from 2.18 per cent and 1 per cent, respectively, in 2013.
In 2012, the figures were 3.01 per cent and 2.10 per cent, respectively.
"The economy should pick up in the second half. Though, the weakening baht against US dollar may push the cost of fuel imports," it said.