Thai Consumers See Prices Fall for Fourth Straight Month.
Falling costs in energy and food contribute to the sharpest price drop since February 2024, offering relief to households as the economy continues its recovery.
Bangkok, Thailand – Consumers in Thailand received a boost to their purchasing power as official data released on Wednesday revealed a continued decline in consumer prices for the fourth consecutive month. The headline consumer price index (CPI) fell by 0.70% in July 2025 compared to the same month last year, a steeper drop than the forecasted 0.45% and the 0.25% decrease seen in June.
This marks the most significant drop in prices since February 2024, keeping the inflation rate below the Bank of Thailand’s target range of 1% to 3%. The primary drivers behind this trend were lower prices for energy and some agricultural goods, according to the Commerce Ministry. Government measures, including subsidies for fuel and electricity, have also contributed to the easing of living costs.
While a sustained period of falling prices, or deflation, can sometimes signal a weakening economy, the Commerce Ministry has indicated that the current situation is not yet a cause for alarm and does not signal the onset of deflation.
Further analysis of the data shows that core inflation, which strips out volatile items like raw food and energy, rose by 0.84% year-on-year. Although this was slightly below forecasts, it points to continued underlying stability in the economy. The pace of this core inflation was the slowest in six months, suggesting that broader price pressures are well-contained.
The latest inflation figures come as Thailand’s economy is projected to continue its growth trajectory in 2025, buoyed by a recovering tourism sector and steady domestic consumption. Economists note that while global uncertainties, such as potential changes in U.S. trade policies, present headwinds, the domestic economy shows resilience. A leading business group recently revised its economic growth forecast for the year upward, citing the positive impact of reduced U.S. tariffs on Thai goods.
The Bank of Thailand has been proactive in its monetary policy, having previously lowered interest rates to support the economic recovery. A senior official from the Finance Ministry has encouraged the central bank to utilize its policy tools to guide inflation back towards its target range.
For the remainder of the year, the Commerce Ministry anticipates that the headline inflation rate will stay within a narrow band of 0% to 1%.This outlook, combined with the ongoing economic growth, suggests that Thai consumers may continue to benefit from stable to lower prices in the near term, providing welcome relief for household budgets.
