Consumer prices record biggest drop since February 2024 in July

Latest reading: Consumer prices declined 0.7% in annual terms in July, a larger drop compared to June’s 0.2% year-on-year decrease and the sharpest fall in consumer prices since February 2024. Price pressures for food and beverages slowed and transportation costs fell at the sharpest rate in over two years. Annual average inflation fell to 0.5% in July (June: 0.6%). Meanwhile, core inflation fell to 0.8% in July from June’s 1.1%. Finally, consumer prices fell 0.27% over the previous month in July, swinging from June's 0.02% increase. July's result marked the weakest reading since June 2024.

Panelist insight: United Overseas Bank’s Enrico Tanuwidjaja and Sathit Talaengsatya said: “We expect domestic private demand to remain subdued amidst an ongoing debt deleveraging process among households and corporates, alongside continued domestic and global economic uncertainty. Concurrently, external demand conditions are also expected to moderate further, amplifying downward pressures on domestic inflation. As a result, we now revise our headline inflation forecast downward.”

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