THAILAND

Annual inflation remained above 3% for the ninth straight month in August as food prices continued to rise.

The consumer price index rose by 3.3% last month from a year earlier after climbing 3.4% in July, 3.3% in June, 3.5% in May and 3% in April.

Food and beverage prices were up 7.5% year-on-year. Prices of vegetables and fruits were up as much as 40% from August last year, as heavy rains and floods disrupted cultivation and harvests in some areas.

Prices of rice, flour and cereal products rose 12.2% in August, meat and poultry 4.2%, and eggs and dairy products 3% year-on-year.

Yanyong Phuangrach, the permanent secretary for the Commerce Ministry, said rising food and beverage prices needed to be weighed against the overall gains in the economy.

"This reflects that the Thai economy is stable and expanding with constant consumer confidence," he said.

On a monthly basis, the inflation rate rose 0.23% from July. For the first eight months of the year, inflation averaged 3.5%, mainly due to rising prices of tap water, fuel oil and power bills.

Core inflation, which excludes volatile fresh food and fuel prices, rose 1.2% last month from a year earlier and increased by 0.01% from July this year. In the first eight months, it stood at 0.8%.

Mr Yanyong said he remained confident that inflation would stay within the ministry's earlier projections of 3% to 3.5% despite growing pressure from higher prices for certain products.

"Full-year inflation is expected to stay in line with the ministry's projection and the impact is also unlikely to be significant should price increases for consumer products be allowed in early October after the government stops trying to control prices," he said.