The latest Core Inflation Rate YoY for Thailand (TH) was released on December 3, 2025, showing a 0.66% increase compared to the previous 0.61% in November. This figure exceeded the market estimate of 0.57%, according to the Sigmanomics database. The data covers the temporal scope of the past 12 months, highlighting a gradual decline from a peak of 1.09% in June 2025 to the current level, reflecting a cooling but persistent inflation environment.

Drivers this month

• Shelter costs contributed approximately 0.20 percentage points to the rise.
• Food and beverage prices remained stable, exerting minimal upward pressure.
• Energy prices showed a slight rebound, adding 0.05 percentage points.

Policy pulse

The Bank of Thailand’s inflation target remains at 1-3%. The current core inflation rate of 0.66% sits below the midpoint but above recent lows, suggesting moderate price pressures that may influence the central bank’s cautious stance on interest rates.

Market lens

Immediate reaction: The THB/USD currency pair strengthened by 0.15% within the first hour post-release, reflecting market confidence in Thailand’s inflation management. Short-term government bond yields edged up by 5 basis points, signaling mild inflation expectations.

Core inflation is a critical macroeconomic indicator, stripping out volatile food and energy prices to reveal underlying price trends. Thailand’s 0.66% YoY core inflation rate contrasts with the headline inflation rate, which remains slightly higher due to external shocks and commodity price fluctuations.

Monetary Policy & Financial Conditions

The Bank of Thailand has maintained a steady policy rate at 1.25% since mid-2025, balancing inflation control with growth support. Financial conditions remain accommodative but are gradually tightening as global interest rates rise. The real policy rate, adjusted for core inflation, is slightly positive, supporting a neutral monetary stance.

Fiscal Policy & Government Budget

Fiscal stimulus measures have tapered in late 2025, with the government focusing on budget consolidation. Public spending growth slowed to 2.50% YoY, reducing inflationary pressures. However, infrastructure investments continue to support medium-term growth prospects.

External Shocks & Geopolitical Risks

Global commodity price volatility, especially in energy, remains a key external risk. Geopolitical tensions in Southeast Asia and trade disruptions could impact import costs, feeding into inflation. The Thai economy’s export dependency makes it vulnerable to such shocks.

Drivers this month

• Shelter and housing-related costs increased by 0.20 pp.
• Energy prices contributed 0.05 pp after recent volatility.
• Transportation costs remained flat, limiting further inflation.

Policy pulse

The Bank of Thailand’s inflation target band of 1-3% remains intact. The current core inflation rate is below the lower bound, suggesting limited immediate pressure for rate hikes but warranting close monitoring.

Market lens

Immediate reaction: Thai government bond yields rose by 5 basis points, while the THB/USD exchange rate strengthened by 0.15%, reflecting market confidence in inflation containment.

Looking ahead, Thailand’s core inflation trajectory depends on several factors, including global commodity prices, domestic demand, and policy responses. The following scenarios outline possible paths for 2026:

Bullish Scenario (30% probability)

• Core inflation rises to 1.20% YoY by mid-2026 due to stronger domestic demand and wage growth.
• Monetary policy tightens moderately, with 25 basis points rate hikes in H2 2026.
• Fiscal stimulus supports consumption without overheating the economy.

Base Scenario (50% probability)

• Core inflation remains stable around 0.60-0.80% YoY.
• Monetary policy remains on hold, with gradual normalization of financial conditions.
• External shocks are contained, and supply chains stabilize.

Bearish Scenario (20% probability)

• Core inflation falls below 0.50% YoY due to weak demand and global slowdown.
• Monetary easing resumes to support growth.
• Fiscal consolidation pressures dampen domestic spending.

Thailand’s core inflation rate of 0.66% YoY in December 2025 reflects a moderate but persistent price pressure environment. The data from the Sigmanomics database confirms a steady decline from mid-year peaks, with current levels suggesting a cautious but stable inflation outlook. Monetary and fiscal policies remain calibrated to balance growth and inflation risks amid external uncertainties.

Structural trends such as urbanization, wage dynamics, and supply chain resilience will shape inflation’s long-run trajectory. Policymakers should remain vigilant to external shocks and domestic demand shifts to maintain price stability and support sustainable growth.

Key Markets Likely to React to Core Inflation Rate YoY

Thailand’s core inflation data influences several key markets, including currency, bonds, equities, and commodities. Market participants closely watch these indicators to gauge monetary policy direction and economic health.

• THBUSD: The Thai baht’s exchange rate versus the US dollar is sensitive to inflation trends and central bank policy shifts.
• SET: Thailand’s stock exchange index reflects investor sentiment tied to inflation and economic growth prospects.
• USDTWD: Regional currency pairs like USDTWD often move in tandem with THBUSD due to shared trade and investment flows.
• BTCUSD: Bitcoin’s price can react to inflation expectations as an alternative store of value.
• BK: Bangkok Bank’s stock price is sensitive to interest rate changes driven by inflation data.

Extras: Core Inflation vs. THBUSD Since 2020

Since 2020, Thailand’s core inflation rate and the THBUSD exchange rate have shown a moderate inverse correlation. Periods of rising core inflation often coincide with THB appreciation, reflecting stronger monetary policy expectations. Conversely, inflation dips have aligned with THB depreciation amid easing policy. This relationship underscores the importance of inflation data in currency market dynamics.

Year	Avg Core Inflation Rate YoY (%)	THBUSD Exchange Rate (Year-End)
2020	0.45	31.50
2021	0.70	30.80
2022	1.10	29.90
2023	0.95	30.20
2024	0.80	30.50
2025	0.85	30.10

FAQs

What is the current Core Inflation Rate YoY for Thailand?

The latest Core Inflation Rate YoY for Thailand is 0.66% as of December 2025, indicating moderate underlying inflation pressures.

How does the Core Inflation Rate affect Thailand’s monetary policy?

Core inflation guides the Bank of Thailand’s interest rate decisions, balancing inflation control with economic growth support.

What external factors influence Thailand’s Core Inflation Rate?

Global commodity prices, geopolitical risks, and supply chain disruptions are key external drivers impacting Thailand’s core inflation.