Bangkok - Thailand's inflation fell by 3 per cent in August, compared with the previous month, as the government's populist policies on reduced utility bills went into effect and world oil prices fell, commerce officials said Monday.

Year-on-year inflation in August was at 6.4. per cent, but it was down 3 per cent compared with July, when the Consumer Price Index (CPI) rose 9.2 per cent year-on-year.

The CPI for the first eight months was 6.7 per cent, said Commerce Ministry Permanent Secretary Siripol Yotmuangcharoen.

Last month the government waived payments on utility bills such as water and electricity for families that use sparingly, and provided free transport on public trains and buses for the poor.

As a result, the CPI index for electricity and water expenditures dropped 39 per cent in August compared with July.

The CPI for transport was down 7.6 per cent in August as global oil prices dropped from an average of 125 dollars per barrel in July to 113 to 115 dollars a barrel last month, Siripol said. (dpa)