Inflation Surges! Low-Income Groups Suffer Most Research Identifies 4 Pressures When Prices of Cheap Goods Rise More Often Than Expensive Ones - Thairath English

As prices rise, inflation remains a frequent topic of discussion. The latest figures from the Ministry of Commerce in October 2026 show general inflation increased by 3.90% year-on-year (YoY), raising concerns about whether prices will surge further. A more critical question is which groups will be most affected or require greater support as inflation rises.

To begin with, Nantapong Jiralertpong, Director of the Office of Trade Policy and Strategy (OTPS) at the Ministry of Commerce, revealed that the general inflation rate in October 2026 rose by 3.90%. The main cause is the 29.18% YoY increase in fuel prices, reflecting global energy conditions, which account for 56% of inflation impact. Meanwhile, core inflation stands at 1.58%.

The general consumer price index increased by 0.94%, with an average rise of 1.77% over the first ten months of 2026 compared to the same period last year.

Comparing Thailand’s inflation with other countries, the Ministry of Commerce cited the general inflation rate of 2.82% in September 2026, ranking Thailand 37th out of 139 economic zones worldwide. Among 10 ASEAN countries, Thailand’s rate ranked fifth, below Indonesia, Vietnam, Cambodia, the Philippines, and Laos.

Tossapol Apaitan from the Puey Ungphakorn Institute for Economic Research stated that under the same cost-of-living crisis, different household groups experience inflation’s effects unevenly. Low-income households typically bear a heavier burden than high-income ones.

In the past five years, Thailand has faced two inflation challenges: in 2022 due to the Russia-Ukraine war, and in 2026 from Middle East conflicts. Analysis of data and situations shows low-income households face inflation rates 2.6 times higher than high-income households.

There are four factors indicating why low-income households suffer more from rising living costs than other groups.

1. Necessities are hard to reduce; high proportion of food expenses.

Low-income households are more affected by inflation because food prices rise fastest. From 2006 to September 2026, prices of food ingredients for home cooking increased by 115%. Low-income groups also allocate a higher share of their spending to food, a necessity with limited adjustment flexibility.

2. Cheapflation: the cheaper the goods, the faster inflation accelerates.

Lower-priced or general goods often face heavier cost pressures, prompting producers to raise prices more quickly and more frequently than premium goods. Moreover, cheaper goods often see reduced promotions or sustained price increases, disproportionately impacting low-income consumers.

3. Shrinkflation: same price, smaller quantity.

This silent threat occurs when producers reduce product quantities but maintain prices so consumers do not notice. Data shows such reductions happen 2.3 times more frequently with cheaper products than with expensive ones, indirectly worsening the burden on low-income groups.

Commonly affected items include shampoo, conditioner, lotion, detergent powder, and powdered milk. Producers may also simultaneously increase prices and quantities, raising unit prices while consumers remain unaware of the true impact.

4. Thin financial buffers limit adjustment ability.  

Low-income households spend up to 88% of their income on expenses, making it harder to adapt compared to middle- or high-income groups. Those with higher incomes can wait for discounts or buy in bulk to lower average unit costs, as research indicates purchasing double-sized products saves about 10%.

Consequently, financial constraints force low-income groups to buy smaller quantities at higher unit prices than those with greater purchasing power.

1. Improve inflation measurement by incorporating diverse data dimensions and increasing reporting frequency—for example, including various product types and online prices. Some countries use scanning technology to check market prices instantly, enabling faster, more comprehensive assessments.

2. Target aid precisely, focusing on the most vulnerable groups severely affected, which is more budget-efficient than broad subsidy measures.

3. Enhance consumer protection by increasing choices and awareness—such as unit price display standards that help consumers understand costs better, and transparent notifications of price and quantity changes. Many countries, including France and South Korea, regulate these aspects by law.

4. Monetary policy should recognize that prolonged high inflation entails higher income distribution costs than average figures suggest. Managing inflation duration is thus a matter of income equity. Monitoring inflation by income group alongside official inflation helps assess shock impacts comprehensively.

Finally, while other countries have diverse inflation databases, Thailand still needs to develop data and research capabilities to analyze inflation from multiple perspectives.

Follow economic data and government policies with ThairathMoney athttps://www.thairath.co.th/money/economics/thai_economics

Follow the Facebook page Thairath Money at this link: https://www.facebook.com/ThairathMoney