National Economic and Social Development Council says it sees gross domestic product expanding 2.5-3.5 percent.
Thailand’s main economic forecasting agency lowered its growth estimate for this year, and raised its inflation expectations, due to the impacts on the global economy from Russia’s war in Ukraine and a slowdown in China.
The National Economic and Social Development Council said Tuesday that it sees gross domestic product expanding 2.5% to 3.5%, lowering its outlook range by a full percentage point from its previous estimate.
“The big concern now is the conflict between Russia and Ukraine, which has a chain-reaction impact,” Danucha Pichayanan, NESDC secretary-general, said at a briefing. “The Covid outbreak situation in China is also another risk as it’s one of Thailand’s major export markets.”
The slower full-year outlook contrasts with a better-than-expected performance last quarter, amid rising tourist arrivals and exports. GDP in the three months ended March advanced 2.2% from a year ago, the NESDC said, faster than the 1.7% median estimate in a Bloomberg survey and a 1.8% expansion the previous quarter.
The baht extended its gain to 0.5% against the dollar following the GDP data and the nation’s benchmark stock index advanced as much as 1.2%, according to data compiled by Bloomberg. The yield on benchmark 10-year government bonds jumped as much as 8 basis points to 3.39%, the highest level since 2014.
Accelerating consumer prices
The growth figures come as the Bank of Thailand faces consumer prices that have accelerated faster than its 1%-3% target range since the beginning of this year. Central banks in Asia from India to Malaysia have begun moving away from their easy money policies as they prioritize fighting inflation over bolstering economic growth.
The full-year growth downgrade is “significant and points to a greater sense of caution among policymakers,” said Euben Paracuelles, economist at Nomura Holdings Inc. in…