Thailand's annual inflation rate slowed to under 1% in March and will drop even lower in the current quarter, the Commerce Ministry stated on Friday as it flagged a cut to its 2025 forecast but said the country was not experiencing deflation.
The inflation rate was expected to fall to around 0.15% in the second quarter due to softer energy prices, said Poonpong Naiyanapakorn, head of the Trade Policy and Strategy Office.
"It's slowing down but not deflation yet," Mr Poonpong said.
The headline consumer price index rose 0.84% in March from a year earlier, the ministry said, below market forecasts and outside the central bank's 1% to 3% target range for the first time in four months.
The core CPI rate was 0.86% in March.
Over the first quarter, the headline inflation rate was 1.08%, a touch below the ministry's forecast.
Mr Poonpong said the ministry will slightly reduce its 2025 headline inflation forecast, currently at between 0.3% to 1.3%, after last year's rate of 0.40%.
Inflation has not been affected by the 7.7-magnitude earthquake in Myanmar that hit Bangkok on March 28, although rental prices of high-rise housing have dropped, he said.
In February, the Bank of Thailand (BoT) cut its key interest rate by 25 basis points to 2.00%. Some economists expect another cut at the BoT's next policy review on April 30 because of the 7.7-magnitude earthquake in Myanmar on March 28 and the imposition of United States tariffs.
According to the University of the Thai Chamber of Commerce (UTCC), reciprocal tariffs imposed by the United States could result in economic losses for Thailand of 359 billion baht, reducing gross domestic product (GDP) by nearly 2%.
