- Slightly below the Bank of Thailand’s (BoT) target range of 1.0-4.0%.

- MoM: 0.0% (Nov: -0.1%).

- Core inflation: sustained at amongst the lowest in 28 months, indicating subdued demand (0.5%; Nov: 0.5%).

- 2019: within forecast range of 0.5-1.0% (0.7%; 2018: 1.1%).

● Higher CPI growth led by a rebound in prices of non-core goods (1.9%; Nov: -0.5%)

- Transport & communication (0.4%; Nov: -2.0%): snapped a six-month streak of falling prices due to a low-base effect.

- Food & non-alcoholic beverages (1.7%; Nov: 1.5%): first uptrend after four months driven by higher vegetables and food prices.

● Weak inflationary pressure within the developing region

- Indonesia (2.7%): withered to a nine-month low on soft inflationary pressure in food, transportation, communication and finance index.

- South Korea (0.7%): highest gain in six months, but averaged at a record-low of 0.4% in 2019, owing to fragile demand.

● 2020 CPI forecasted to register between 0.6-0.8% (2019: 0.7%), below the BoT’s 2020 target range of 1.0-3.0%

- Inflationary pressure to remain benign amid headwinds from a soft global economic momentum, uncertainties over the US-China trade negotiation and rising geopolitical tension.

- BoT to stick to its dovish monetary stance, potentially resuming its monetary easing in the 1Q20 (25 basis points rate cut) given continued weakness in recent economic indicators (e.g. manufacturing production, exports, public expenditure).

Source: Kenanga Research - 3 Jan 2020