BANGKOK Thailand's headline inflation rate dropped to its lowest in 21 months in May due to falling energy and food prices and a high base in 2022, the commerce ministry said on Tuesday.

The headline consumer price index (CPI) rose 0.53% in May from a year earlier, below a forecast rise of 1.70% in a Reuters poll, and against April's 2.67% year-on-year increase.

The core CPI index in May rose 1.55% from a year ago, below a forecast increase of 1.6%, and against April's 1.66% rise.

It was the third month in a row that headline inflation came in within the central bank's target range of 1% to 3%.

Headline inflation will further slow in May and contract in June, ministry official Wichanun Niwatjinda told a press conference.

Falling goods and energy prices combined with a higher base last year attributed to the decline, Wichanun added.

The commerce ministry forecast average headline inflation at between 1.7% and 2.7% for this year.

In the January-May period, annual headline inflation was 2.96%, with the core rate at 1.98%, the ministry said.

Last week, Thailand's central bank raised its policy interest rate by a quarter point to 2%, citing core inflation remained elevated. It will next review the rate on Aug. 2.

(Reporting by Orathai Sriring and Kitiphong Thaichareon; Editing by Kanupriya Kapoor)