Thai Prices Fall For Fifth Month As Economy Contracts

[churchill]

June 1 (Bloomberg) -- Thailand’s consumer prices dropped for a fifth month in May, the longest contraction in at least nine years, as demand collapsed amid the shrinking economy.

An index of consumer prices fell 3.3 percent from a year earlier, after declining 0.9 percent in April, the Commerce Ministry said today in Bangkok. The median estimate of 12 economists in a Bloomberg survey was for a 2.4 percent decline. The gauge has fallen each month this year, the longest slump since Bloomberg began tracking it in 2000.

“Consumer prices will contract until at least the third quarter,” said Pimonwan Mahujchariyawong, an economist at Kasikorn Research Ltd. in Bangkok. “Local demand is very fragile and hasn’t shown any clear recovery sign yet.”

The worst global economic slump since the Great Depression and domestic political protests have sent Thailand’s economy into its first recession in a decade. Prime Minister Abhisit Vejjajiva said May 28 that Thailand may face deflation, although it’s “under control.” The government is boosting spending to spur demand, and the central bank says the worst may be over.

The Bank of Thailand on May 20 held its one-day bond repurchase rate at 1.25 percent, ending its most aggressive ever string of reductions from December to April. Gross domestic product shrank 7.1 percent in the first quarter, the steepest contraction in a decade. The economy may return to growth in the fourth quarter, the government predicts.

Lower Oil Price

Lower fuel costs compared with a year ago and government measures to help low-income earners, including free bus rides and utilities, contributed to the drop in consumer prices, said Pimpapaan Chansilpa, deputy secretary-general for commerce. The price of crude oil, almost all of which Thailand imports, has fallen more than 50 percent from a record $147.27 a barrel in July last year.

“Consumer prices may pick up from August in line with rising oil prices and the end of the government’s measures,” Pimpapaan told a press conference in Nonthaburi province. “We still maintain our target of 0.5 percent inflation for the whole year.”

Abhisit’s government on May 6 unveiled a four-year, 1.4 trillion-baht ($41 billion) investment plan. His seven-party coalition government is strong enough to pass a borrowing plan and next year’s 1.7 trillion-baht budget, Abhisit said May 20.

Thailand’s core inflation index, which excludes fresh food and fuel, fell 0.3 percent last month from a year earlier, the Commerce Ministry said today. Economists surveyed by Bloomberg News predicted a 0.6 percent gain. The measure increased 1 percent in April.

http://www.bloomberg.com/apps/news?pid=206...id=apqb7NAMol2Q

[Mosha]

I wish someone would tell my egg man. A tray of agg has gone up about 10 baht in 2 months.

[jackdanielsesq]

Sir Winston - great name & good reference source - my personal favorite.

BR>Jack

[deprogrammed]

Total BS - prices of everyhting from lemon grass to pork to petrol is going up up up. Thais will be starving if things continue as they are

[barryofthailand]

And what are you talking about lower fuel costs. oil is skyrocketting again, and fuel costs are reflecting it.

Barry

[dieter1]

energy does play a big part of the basket. And if you look at oil prize last year compared to this year, only this can mean the biggest part of whole "deflation" And you do not know, what they take in the basket to get the figure. It is just an estimation, and depends a lot on what kinds of goods they take to estimate.

So look only at oil, maybe electronics, household machines there may be a real decline. Even rice prizes may have declined (because they do skyrockening (?) last year, same do many other basic foods. (oil, ...).

So it could be, that 50 % of prizes of goods in your local supermarket were going up , and still there may be a falling in the whole. 3,3 % in 12 month is not that much. But normally it is the other way round !

my two cents ....

[tigerbalm]

Can't see any mention of what has actually come down in price i get the general view that the reverse i the case.

Even the Brit pound is going up

[Priceless]

Can't see any mention of what has actually come down in price i get the general view that the reverse i the case.

Even the Brit pound is going up

A few examples:

Gasohol 95 at this time last year cost 35.95 baht/litre, now 28.54 baht/litre.

My water bill for May last year was 216.68 baht, this year 0 (subsidized by the government).

My ADSL TOT GoldCyber (2Mb/512kb) last year cost me 1070 baht/month (incl VAT). This year PlatinumCyber (3Mb/512kb) costs me 631 baht.

/ Priceless

[tigerbalm]

Can't see any mention of what has actually come down in price i get the general view that the reverse i the case.

Even the Brit pound is going up

A few examples:

Gasohol 95 at this time last year cost 35.95 baht/litre, now 28.54 baht/litre.

My water bill for May last year was 216.68 baht, this year 0 (subsidized by the government).

My ADSL TOT GoldCyber (2Mb/512kb) last year cost me 1070 baht/month (incl VAT). This year PlatinumCyber (3Mb/512kb) costs me 631 baht.

/ Priceless

Sorry may be i should have said what has actually come down with out the intervention of government subsidies Like gasahol and some water bills.

[Priceless]

Can't see any mention of what has actually come down in price i get the general view that the reverse i the case.

Even the Brit pound is going up

A few examples:

Gasohol 95 at this time last year cost 35.95 baht/litre, now 28.54 baht/litre.

My water bill for May last year was 216.68 baht, this year 0 (subsidized by the government).

My ADSL TOT GoldCyber (2Mb/512kb) last year cost me 1070 baht/month (incl VAT). This year PlatinumCyber (3Mb/512kb) costs me 631 baht.

/ Priceless

Sorry may be i should have said what has actually come down with out the intervention of government subsidies Like gasahol and some water bills.

OK, if you don't like my gasohol, let's take diesel:

2008: 39.04 baht/litre --- 2009: 25.39 baht/litre

The water bill is one example of the government's efforts to keep prices down during hard times. This to an extent offsets the price increases that are also due to government actions, like some agricultural products.

You simply cannot say anything meaningful about (consumer) price levels in Thailand if you don't include products whose prices are influenced by government actions.

/ Priceless

[tigerbalm]

Can't see any mention of what has actually come down in price i get the general view that the reverse i the case.

Even the Brit pound is going up

A few examples:

Gasohol 95 at this time last year cost 35.95 baht/litre, now 28.54 baht/litre.

My water bill for May last year was 216.68 baht, this year 0 (subsidized by the government).

My ADSL TOT GoldCyber (2Mb/512kb) last year cost me 1070 baht/month (incl VAT). This year PlatinumCyber (3Mb/512kb) costs me 631 baht.

/ Priceless

Sorry may be i should have said what has actually come down with out the intervention of government subsidies Like gasahol and some water bills.

OK, if you don't like my gasohol, let's take diesel:

2008: 39.04 baht/litre --- 2009: 25.39 baht/litre

The water bill is one example of the government's efforts to keep prices down during hard times. This to an extent offsets the price increases that are also due to government actions, like some agricultural products.

You simply cannot say anything meaningful about (consumer) price levels in Thailand if you don't include products whose prices are influenced by government actions.

/ Priceless

Yes i kind of agree with the jist of your quoting from a year ago when we all know prices of Oil momentarily shot thru the roof and if you quote prices in relation to that period then yes they have gone down significantly, but i cant help feeling that if one used say prices from two years ago then the out come would be conciderably different.

Also you could take these comparisons a little nearer to today and say what has been the general trend over the last4-6 months i remenber not so many months ago the gasoline prices came down to about 23-24 Bht per litre now we are seing them at 32+bht a litre, pointing to an increas in fuel costs for the consumer .

As for subsadies yes the prices for certain consumer related items like water have enabled prices coming down but it is the people who in the end foot the bill for this and the money has to be diverted from other sources i would imagine to pay for this.

The goverment is borowing heavily at the moment and will be faced with huge repayment and interest on top of this for many years,placing a costly burden on the peopel and the tax payer ultimatly ending up in higher prices.

we have seen it recently with the hike in stealth taxes and not so long ago increases in the Electricity prices, i have a feeling the gov knows that they need to do some thing quick because they are going to be burdened soon with huge debt repayment.

Thais are seing this to i live in a small village and get the geneal feeling from what they tell me they see increased prices wheather it be gasoline the Bottled Gas they use for cooking food, Eelectric, and so on.

Food vendors are saying business is getting less customers because thais are staying at home to eat and there is a lot more of those little white stickers covering menus that they use when they increase prices rather than get the whole menu changed.

TB

[Shotime]

Total BS - prices of everyhting from lemon grass to pork to petrol is going up up up. Thais will be starving if things continue as they are

“Consumer prices will contract until at least the third quarter,” said Pimonwan Mahujchariyawong, an economist at Kasikorn Research Ltd. in Bangkok. “Local demand is very fragile and hasn’t shown any clear recovery sign yet.”

What year is he referring to?

[LongThaimer]

can't bothered to be too statistical...

from purely personal perspective, a can of milk for my daughter has gone up from 220 to 250 in just 2 months......latest hike was last weekend......

maybe some less essential commodities are slightly going down but necessities like fuel and food kept rising.........seems like the last 2 yrs have been most drastic in terms of increase in costs of living in all 15 yrs. i've been in thailand......

[Priceless]

[...]

Yes i kind of agree with the jist of your quoting from a year ago when we all know prices of Oil momentarily shot thru the roof and if you quote prices in relation to that period then yes they have gone down significantly, but i cant help feeling that if one used say prices from two years ago then the out come would be conciderably different.

Also you could take these comparisons a little nearer to today and say what has been the general trend over the last4-6 months i remenber not so many months ago the gasoline prices came down to about 23-24 Bht per litre now we are seing them at 32+bht a litre, pointing to an increas in fuel costs for the consumer .

As for subsadies yes the prices for certain consumer related items like water have enabled prices coming down but it is the people who in the end foot the bill for this and the money has to be diverted from other sources i would imagine to pay for this.

The goverment is borowing heavily at the moment and will be faced with huge repayment and interest on top of this for many years,placing a costly burden on the peopel and the tax payer ultimatly ending up in higher prices.

we have seen it recently with the hike in stealth taxes and not so long ago increases in the Electricity prices, i have a feeling the gov knows that they need to do some thing quick because they are going to be burdened soon with huge debt repayment.

Thais are seing this to i live in a small village and get the geneal feeling from what they tell me they see increased prices wheather it be gasoline the Bottled Gas they use for cooking food, Eelectric, and so on.

Food vendors are saying business is getting less customers because thais are staying at home to eat and there is a lot more of those little white stickers covering menus that they use when they increase prices rather than get the whole menu changed.

TB

You're not going to give up, so I don't know why I keep replying.

Gasohol 95 : 2009 - 2008 - 2007 : 28.54 - 35.95 - 26.69

Diesel : 2009 - 2008 - 2007 : 25.39 - 39.04 - 25.34

Yes, Gasohol 95 is now 1.85 baht/litre more expensive than two years ago and diesel is 0.05 baht/litre more expensive. But go on, the crude oil price has been so volatile that sooner or later you're going to come upon a point in time when fuel was cheaper than it is now. (Hint: Try four months ago when crude was at 38 USD/barrel, compared to 68 USD/barrel now.)

I didn't choose my original time periods to prove a point, I chose them because it is customary to compare year-on-year. If you freely choose your comparison points, you can prove anything with (price) statistics.

/ Priceless

[carriemai]

[...]

Yes i kind of agree with the jist of your quoting from a year ago when we all know prices of Oil momentarily shot thru the roof and if you quote prices in relation to that period then yes they have gone down significantly, but i cant help feeling that if one used say prices from two years ago then the out come would be conciderably different.

Also you could take these comparisons a little nearer to today and say what has been the general trend over the last4-6 months i remenber not so many months ago the gasoline prices came down to about 23-24 Bht per litre now we are seing them at 32+bht a litre, pointing to an increas in fuel costs for the consumer .

As for subsadies yes the prices for certain consumer related items like water have enabled prices coming down but it is the people who in the end foot the bill for this and the money has to be diverted from other sources i would imagine to pay for this.

The goverment is borowing heavily at the moment and will be faced with huge repayment and interest on top of this for many years,placing a costly burden on the peopel and the tax payer ultimatly ending up in higher prices.

we have seen it recently with the hike in stealth taxes and not so long ago increases in the Electricity prices, i have a feeling the gov knows that they need to do some thing quick because they are going to be burdened soon with huge debt repayment.

Thais are seing this to i live in a small village and get the geneal feeling from what they tell me they see increased prices wheather it be gasoline the Bottled Gas they use for cooking food, Eelectric, and so on.

Food vendors are saying business is getting less customers because thais are staying at home to eat and there is a lot more of those little white stickers covering menus that they use when they increase prices rather than get the whole menu changed.

TB

You're not going to give up, so I don't know why I keep replying.

Gasohol 95 : 2009 - 2008 - 2007 : 28.54 - 35.95 - 26.69

Diesel : 2009 - 2008 - 2007 : 25.39 - 39.04 - 25.34

Yes, Gasohol 95 is now 1.85 baht/litre more expensive than two years ago and diesel is 0.05 baht/litre more expensive. But go on, the crude oil price has been so volatile that sooner or later you're going to come upon a point in time when fuel was cheaper than it is now. (Hint: Try four months ago when crude was at 38 USD/barrel, compared to 68 USD/barrel now.)

I didn't choose my original time periods to prove a point, I chose them because it is customary to compare year-on-year. If you freely choose your comparison points, you can prove anything with (price) statistics.

/ Priceless

You keep quoting the price of gasoline, which has always been an excuse for raising the prices of everything, without prices ever coming down when the price of gasoline does.

I agree with the posters who say this total BS. I shop almost exclusively at my local talad nats at least twice a week and see the prices of absolutely everything rising on each and every visit, with only the various seasonal fruit being 'fire sold' as of course there tends to be a glut when everything comes into season at once and they want to offload it before it rots.

I too wonder how the locals survive. It's truly is bloody disgusting.

Edited June 3, 2009 by carriemai

[tigerbalm]

[...]

Yes i kind of agree with the jist of your quoting from a year ago when we all know prices of Oil momentarily shot thru the roof and if you quote prices in relation to that period then yes they have gone down significantly, but i cant help feeling that if one used say prices from two years ago then the out come would be conciderably different.

Also you could take these comparisons a little nearer to today and say what has been the general trend over the last4-6 months i remenber not so many months ago the gasoline prices came down to about 23-24 Bht per litre now we are seing them at 32+bht a litre, pointing to an increas in fuel costs for the consumer .

As for subsadies yes the prices for certain consumer related items like water have enabled prices coming down but it is the people who in the end foot the bill for this and the money has to be diverted from other sources i would imagine to pay for this.

The goverment is borowing heavily at the moment and will be faced with huge repayment and interest on top of this for many years,placing a costly burden on the peopel and the tax payer ultimatly ending up in higher prices.

we have seen it recently with the hike in stealth taxes and not so long ago increases in the Electricity prices, i have a feeling the gov knows that they need to do some thing quick because they are going to be burdened soon with huge debt repayment.

Thais are seing this to i live in a small village and get the geneal feeling from what they tell me they see increased prices wheather it be gasoline the Bottled Gas they use for cooking food, Eelectric, and so on.

Food vendors are saying business is getting less customers because thais are staying at home to eat and there is a lot more of those little white stickers covering menus that they use when they increase prices rather than get the whole menu changed.

TB

You're not going to give up, so I don't know why I keep replying.

Gasohol 95 : 2009 - 2008 - 2007 : 28.54 - 35.95 - 26.69

Diesel : 2009 - 2008 - 2007 : 25.39 - 39.04 - 25.34

Yes, Gasohol 95 is now 1.85 baht/litre more expensive than two years ago and diesel is 0.05 baht/litre more expensive. But go on, the crude oil price has been so volatile that sooner or later you're going to come upon a point in time when fuel was cheaper than it is now. (Hint: Try four months ago when crude was at 38 USD/barrel, compared to 68 USD/barrel now.)

I didn't choose my original time periods to prove a point, I chose them because it is customary to compare year-on-year. If you freely choose your comparison points, you can prove anything with (price) statistics.

/ Priceless

You have your view and i have mine i beg to disagree and you beg to disagree lets leave it at that, i certainly do not want to get in to a slanging match which will distract from the real issue on what this topic is about. Have a nice day.

Move on

[Priceless]

Can't see any mention of what has actually come down in price i get the general view that the reverse i the case.

Even the Brit pound is going up

This was your original post. I responded by pointing out that fuel, water and telecomm's had come down. You continue to claim that the general price level is going up, and that the Bank of Thailand statistics are BS. Let's agree to disagree

/ Priceless

[churchill]

i think we have inflation building in the future , although it may take some time to feed through to the figures - Exchange rates will also effect inflation in Thailand - Perhaps I am wrong but if the $ weakens against the baht that will suppress inflation in Thailand ?

From FT

"All sectors post phenomenal gains in May, except livestock

Commodity prices rallied in May as central banks continued to pump liquidity into the global economy, with every sector but livestock showing strong performance. In May, gasoline, WTI crude oil and silver generated individual returns exceeding 25%. The MLCX TR index increased by 18.99% in May, the DJ-UBS TR index (former DJ-AIG) posted 13.00% and the S&P GSCI TR returned 19.67%. The ML US Broad Bond Market index yielded 0.80% and the S&P 500 TR gained 5.59%.

The only sector that failed to perform in May was livestock, with the MLCX Livestock TR index posting -1.54% returns. Grains on the other hand had a strong month with high returns in wheat and soybeans. The MLCX Grains TR index returned 13.86% in May. The MLCX Softs TR index yielded 10.69% in the month."

http://ftalphaville.ft.com/blog/2009/06/02...may/?source=rss

[tigerbalm]

Can't see any mention of what has actually come down in price i get the general view that the reverse i the case.

Even the Brit pound is going up

This was your original post. I responded by pointing out that fuel, water and telecomm's had come down. You continue to claim that the general price level is going up, and that the Bank of Thailand statistics are BS. Let's agree to disagree

/ Priceless

Well at least we agree on some thing

TB

[sushi5734]

My girlfreind (who owns a few restuarants and food stalls) has been complaining for a few months about the prices of eggs, chicken, rice etc. going up very rapidly, obviously she is buying in bulk from the markets, but she is worrying that she will have to put prices up.

I think alot of Thais are starting to feel the pinch and most have a lot less room to manouver than the average farang.

I really feel that the Thai economy is due for a bit of hard time over the next few years.

[thaiwanderer]

Consumer prices can no longer be accurately compared with a year ago because they have (conveniently) changed the inidicator types, their relative weightings and method of calculation.

Fuel costs? That will be down to the Oil Fund subsidy.

They have a plan......to borrow. Well done.

'under control' is certainly correct but perhaps not in the way inferred in the article.

[Priceless]

Consumer prices can no longer be accurately compared with a year ago because they have (conveniently) changed the inidicator types, their relative weightings and method of calculation.

Fuel costs? That will be down to the Oil Fund subsidy.

They have a plan......to borrow. Well done.

'under control' is certainly correct but perhaps not in the way inferred in the article.

Have you got a source for the highlighted statement?

That the fuel costs have gone down just might have been influenced by the fact that the price of crude oil is about half of what it was a year ago...

/ Priceless

[mijan24]

March 2009 Bangkok to Sydney ® 25500

July cost quoted for same trip 38000

Prices seem to be rising?? but maybe it's just seasonal adjustment?