InfoQuest, (April 1, 2019) -- KResearch has lowered its Thai GDP growth forecast to 3.7 percent, or within a range of 3.2-3.9 percent, from the previously forecast 4 percent according to Nattaporn Triratanasirikul, KResearch assistant managing director.
"The lower GDP-growth projection reflects an expected slowdown in Thai exports resulting from the economic downturn in the country's key trading partners. Although the US-China trade war is not as worse as expected, it still has an influence on Thai exports," she said. As a result, KResearch has cut its export-growth projection for 2019 to 3.2 percent from the previous 4.5 percent, and its import-growth forecast to 4.3 percent from 5.3 percent.
In addition, no matter how the government is formed, whether in the form of a coalition government or in other forms, Thailand will go through export weakness against the backdrop of global economic slowdown. Thus, the new government has to introduce economic-stimulus policies under the fiscal year 2019 budget, and accelerate the pass of the fiscal year 2020 budget bill. If the new government can be formed within June, and the economic stimuli can be implemented as expected, household consumption will be boosted by 0.2-0.4 percent of gross domestic product, and the Thai economy in the second half of 2019 will present the momentum of recovery and see stronger growth than in the first half.
“In terms of domestic interest rates, the policy rate is forecast to remain at 1.75 percent throughout this year. Given high liquidity at local commercial banks, and the banks' gradual approach to approving loans, competition in the banks' interest rates will not be intensified," she explained. “As for the movement of the baht, KResearch forecasts the US dollar to baht exchange rate will fluctuate within the range of 31.20-31.50. Meanwhile, factors deserving close attention are still domestic issues, including the political and economic situations,” she said.
Source: InfoQuest, by Jeerayuth Junsongsakun / Kasamarporn/ Ratchada, translated by Xinhua Silk Road
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