Bank Of Thailand Raise Growth Forecast

[webfact]

ECONOMY 2012

BOT raise growth forecast

SEETALAVAJIT SABAYJAI

THE NATION

BANGKOK: -- The economy is set to see higher growth this year, driven mainly by domestic demand after last year's floods, but downside risks remain in the growth of trading countries, the Bank of Thailand said.

The central bank yesterday raised its 2012 growth estimate to 4.9 per cent from its previous forecast of 4.8 per cent. Gross domestic product is projected to grow by 5.6 per cent in 2013.

In 2012, the economy will likely be driven by domestic demand, including private investment and consumption, and government stimulus measures, as the world economy is slowing down, BOT Assistant Governor Paiboon Kittisrikangwan said.

However, the threat to growth is higher than upside risk this year if Thailand's trading countries see lower-than-expected economic expansion, he noted. The upside risk to the Thai economy will rise if the government's economic stimulus is higher than expected.

"That depends on the global economy, which is expected to grow more than 3 per cent in 2012, and our trading partners are expected to see combined average growth of 4.8 per cent this year," Paiboon said.

The global economy has not entered recession yet even though Europe is already in recession, he said.

"This year's estimated Thai export growth of 7.8 per cent is satisfactory amid the global economic situation now," Paiboon said. Exports grew 16.4 per cent last year.

Given the worst damage in history from last year's floods, the central bank slashed its 2011 GDP growth estimate to 1 per cent. Its loss estimate ??? was revised up to 3.1 per cent of the nation's gross domestic product, up from its forecast of 2.1 per cent in November 2011.

This year's estimate on core inflation has been lowered to 2.2 per cent from the earlier projection of 2.4 per cent. The central bank foresees 2013 core inflation at 1.7 per cent.

The headline inflation forecast for 2012 was also lowered to 3.2 per cent from the previous forecast of 3.5 per cent. The headline figure is expected at 2.9 per cent in 2013.

During the second half of this year, domestic pressure is likely to pick up with recovered demand and the impact of stimulus measures, but will be offset by softened global oil and commodity prices on the back of the global economic slowdown.

"Inflationary pressure is subdued and will tend to return to its normal level in 2013 as the impact from the government measures will likely diminish," Paiboon said.

Factors that need to be monitored are a resolution of the European sovereign-debt crisis, which could affect other countries through the real economic sector and financial markets, and the Thai government's policy on water management, which could affect confidence and the Kingdom's economic recovery.

However, if any positive or negative factors arise, the monetary policy is sufficiently flexible to be adjusted to cope with the changing situation, he said.

-- The Nation 2012-02-04

[Footloose1949]

Thailand and most of the Asian countries seem to have evaded the cluches of International bankers selling on their toxic debt. Maybe these countries refused to relax the banking rules put in place after the 1920-30 recession? Also, they are a lot closer to the Chinese economy, and benefit from the wealth swilling around there.

[Ricardo]

Forecast increased from 4.8% to 4.9%, Yay for PTP/Red-Shirt Economic-Forecasts !

Meanwhile back in the real world, I believe that Thai caution was probably more-related to being in-the-throes of their own 1997 Asian Economic Crisis, and trying to work their way out of it ?

[Chris Lawrence]

Maybe Mr T saw the problems with taking on the Yankee debt cows? Or the European bankers didn't have the Asian bankers phone numbers? I wouldn't want to be holding US dollars and living in Thailand at the moment. Thai baht could stay high for this year?

[pooket]

This guy said that the world economy is slowing down. I think that's yesterday's news. It's starting to look like the world already hit bottom and is just beginning to come up (other than that mess they call Europe). If not, why have the SET and the DOW broken out this past week? Remember, the market is predictive, not reactive.

If Europe can get its head out of its ass, 2012 might be a good year.

[rakman]

This guy said that the world economy is slowing down. I think that's yesterday's news. It's starting to look like the world already hit bottom and is just beginning to come up (other than that mess they call Europe). If not, why have the SET and the DOW broken out this past week? Remember, the market is predictive, not reactive.

If Europe can get its head out of its ass, 2012 might be a good year.

My feelings are to watch the price of oil. Greater than US$100 is the start of the danger point. Another round of QE by the US Fed will devalue the dollar and push inflation up, which will slow the economy. So right now we're on the edge.

[IsaanUSA]

I wouldn't want to be holding US dollars and living in Thailand at the moment. Thai baht could stay high for this year?

I wouldn't want to be holding Euro and living in Thailand. The dollar is looking okay at the moment. But let's see how the election in the USA goes this fall.