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Internet, cellphone fees to have greater weight in calculating inflation


THE COMMERCE Ministry will adjust its inflation calculation system by increasing the weightage for Wi-Fi and mobile phone service fees, and processed food in order to reflect the real cost of daily spending. The change is due to greater use of Internet and mobile phones by customers, while lifestyle has seen a huge change.

Also, the ministry foresees stronger inflation next year from an expected average of between 0-1 per cent this year, mainly based on expectation of oil price increasing from US$35-$45 per barrel to above $50 per barrel.
Pimchanok Wornkorporn, deputy director-general of the ministry’s Policies and Trade Strategies Bureau, said Internet is playing a greater role in the daily life of people. The new inflation basket weight, which currently has 450 items of goods and services, would be adjusted next year. The ministry will revise some items and add items that play a greater role in the daily life of people so that inflation will precisely reflect the cost of living.
For instance, home Internet cost should be included in the inflation basket next year, while mobile-phone fee and the cost of processed food would have more weight in calculating inflation.
In addition, as an agency responsible for calculating the cost of living, the ministry would conduct a “purchasing power parity” index in each province so that the private sector and other government sectors can use the information to help local consumers or determine the minimum wage for each province.
The purchasing power parity is measured by finding the values of a basket of consumer goods (such as rice, fruits, and some essential goods, etc.). If that basket costs Bt100 in one province, in another province may cost Bt120 depending on the price of goods.
This PPP has been started to collect information covering 43 provinces now. The ministry plans to cover 77 provinces by early next year.
 

Published : November 06, 2016

By : PETCHANET PRATRUANGKRAI THE NATION