Thailand Economic Forecast

Thailand Economic Outlook

December 13, 2018

Economic growth decelerated in the third quarter on a weakening external sector after exports were hit by spillovers from the U.S.-China trade spat. Domestic demand, however, remained resilient in the quarter, with private consumption growing at the fastest pace in nearly two years amid improving wage growth and subdued inflation. Data on the fourth quarter is somewhat mixed. The external sector started off on the wrong foot, recording a small deficit in October as merchandise import growth outpaced export growth. In addition, the manufacturing PMI remained below the critical 50-point mark through November, indicating a deterioration in operating conditions in the sector. In more positive news, private consumption expanded robustly in October, while private investment growth accelerated to a near six-year high in the same month.

Thailand Economic Growth

Thailand’s economy is expected to continue growing at a solid, albeit more moderate, clip next year, powered by growing government consumption and fixed investment. However, softening contributions from the external sector and private consumption will likely weigh on growth. Looking ahead, although a continuation of the recent ceasefire in the Sino-American trade dispute would reduce downside risks to the external sector, possible tensions in the lead-up to general elections pose a threat. Our panel projects economic growth of 3.8% in 2019, which is unchanged from last month’s forecast, and 3.5% in 2020.

Thailand Economy Data

20132014201520162017
Population (million)68.368.768.869.069.1
GDP per capita (USD)6,1725,9375,8195,9706,591
GDP (USD bn)422118111412455
Economic Growth (GDP, annual variation in %)2.71.03.03.33.9
Consumption (annual variation in %)0.90.82.33.03.2
Investment (annual variation in %)-1.0-2.24.32.80.9
Manufacturing (annual variation in %)1.9-4.00.01.42.5
Retail Sales (annual variation in %)0.0-5.8-0.11.06.2
Unemployment Rate0.60.60.70.81.0
Fiscal Balance (% of GDP)-1.9-2.9-2.9-2.8-3.5
Public Debt (% of GDP)42.242.543.711.741.8
Money (annual variation in %)3.91.35.74.89.4
Inflation Rate (CPI, annual variation in %, eop)1.70.6-0.91.10.8
Inflation Rate (CPI, annual variation in %)2.21.9-0.90.20.7
Inflation (PPI, annual variation in %)0.30.1-4.1-1.20.7
Policy Interest Rate (%)2.252.001.501.501.50
Stock Market (annual variation in %)36.0-13.624.1-17.721.2
Exchange Rate (vs USD)32.7632.9236.0435.7832.64
Exchange Rate (vs USD, aop)30.6832.4434.2135.2433.90
Current Account (% of GDP)-1.23.78.011.711.6
Current Account Balance (USD bn)-4.915.232.148.248.1
Trade Balance (USD billion)0.117.226.836.631.8
Exports (USD billion)228227214214235
Imports (USD billion)228211187178203
Exports (annual variation in %)0.3-0.6-5.90.49.5
Imports (annual variation in %)0.3-8.1-11.0-4.814.2
International Reserves (USD)167157157172203
External Debt (% of GDP)33.734.832.732.132.7

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Thailand Facts

ValueChangeDate
Bond Yield2.480.0 %Jan 21
Exchange Rate31.700.17 %Jan 21
Stock Market1,588-1.41 %Jan 21

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