Thai May headline CPI rises 2.44% year on year, lower than forecast

FILE PHOTO: A mother and her daughter shop for bananas at a market in Bangkok, Thailand, March 31, 2016. REUTERS/Athit Perawongmetha

BANGKOK (Reuters) - Thailand's headline consumer price index (CPI) rose for a second straight month in May, up 2.44% from a year earlier, the commerce ministry said on Friday, slightly missing analyst expectations.

The figure, weighed down by government utility subsidies, compared with a forecast for a rise of 2.85% in a Reuters poll and followed April's 3.41% increase.

The headline CPI is expected to rise again in June, but at a slower pace partly due to the subsidies, ministry official Wichanun Niwatjinda told a briefing.

CPI growth is expected at 2.3% year-on-year in the second quarter, before slowing to 1.59% in the third quarter and 1.35% in the fourth quarter due in part to energy prices and base effects, he said.

However, the pace may be lower than forecast if the government extends utility subsidies after June, he said.

In May, the core CPI index was up 0.49% from a year earlier, versus a forecast for a 0.45% rise and after April's 0.30% increase.

In the January-May period, the headline CPI rose 0.83% from a year earlier, with the core CPI up 0.23%.

The ministry has forecast the headline inflation rate at 0.7% to 1.7% this year.

(Reporting by Orathai Sriring, Kitiphong Thaichareon and Satawasin Staporncharnchai; Editing by Ed Davies)