Thai Inflation At 3.0 Percent In September

Thai inflation at 3.0 percent in September

BANGKOK, October 1, 2010 (AFP) - Thailand said Friday that inflation rose 3.0 percent year on year in September -- marking the 12th straight monthly increase -- as the kingdom forecasts continued strength for its economy.

Consumer prices, which slowed marginally from August when the rate stood at 3.3 percent year on year, are now expected to to be an average of 3.3 percent in 2010, from previous estimates of 3.5 percent.

Commerce ministry permanent secretary Yanyong Phuangrach said inflation would have "more stability" from the fourth quarter and economic growth was forecast at 7.5 percent in 2010 -- the top end of Bank of Thailand estimates.

September's figure was driven by rises in the food and beverage sector, where prices were up 6.6 percent compared to the same month last year.

Core inflation -- which strips out volatile food and energy prices -- rose 1.1 percent from 2009, while average core inflation for first nine months of this year was up 0.8 percent on the same period last year.

The Thai economy has remained relatively resilient following two months of mass opposition protests, which brought parts of Bangkok to a standstill and sparked clashes that left 91 people dead, ending with an army crackdown in May.

In August the central bank raised interest rates for a second consecutive month -- to 1.75 percent -- to keep a lid on inflation after the unexpectedly strong performance by the Thai economy despite the unrest.

Strong exports helped Thai output expand 9.1 percent in the second quarter of 2010 from a year earlier and official figures have shown the economy grew 10.6 percent in the first six months of the year.

Thai shipments overseas, driven by solid demand for auto parts and electronics, increased for the 10th straight month in August despite a surge in the value of the baht, along with other Asian currencies.

The Bank of Thailand has recently proposed measures to curb the strength of the Thai currency, which hit a 13-year high against the dollar in September.

-- (c) Copyright AFP 2010-10-01