Krungthai COMPASS warns year-end inflation may exceed 2% target

Khaosod•Economy•12d ago

Reader Briefing

Krungthai COMPASS predicts Thai inflation for the remainder of 2026 will likely exceed the 2% target midpoint due to energy costs, domestic demand, and El Nino.

•Thai general inflation in August 2026 rose to 2.53% YoY, exceeding analyst expectations of 2.37%.
•Energy costs contributed 41.5% to general inflation, with Dubai crude oil prices rising above 100 US dollars.
•The Business Sentiment Index (BSI) for August remained below 50 for the ninth consecutive month.
•El Nino and volatile Middle East tensions are identified as key risks for year-end inflation.

Overview

•General inflation in August 2026 was 2.53% YoY, an increase from 1.95% in the previous month.
•Energy factors contributed 41.5% to general inflation, while core inflation reflecting domestic demand contributed 39.9%.
•Fresh food prices rose due to volatile weather, with a warning that El Nino effects late this year could further increase prices.
•Dubai crude oil prices rose above 100 US dollars, compared to a previous monthly average of 79.7 US dollars per barrel.
•The Business Sentiment Index (BSI) for August was below 50 for the ninth consecutive month due to production cost concerns.
•Higher production and transport costs are beginning to push up prices for electrical appliances, furniture, and cleaning equipment.
•Krungthai COMPASS notes that domestic demand may keep core inflation high longer than expected.
•Krungthai COMPASS advises monitoring inflation drivers from energy, domestic demand, and supply-side risks toward the end of the year.

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Key Entities

Organization

Krungthai COMPASS Research Center(ศูนย์วิจัย Krungthai COMPASS)

A research center that assesses Thai inflation trends and business sentiment.

Place

Middle East(ตะวันออกกลาง)ℹ️

A region where high tensions are causing volatility in energy prices.