Thai Q3 GDP Accelerates From Previous Quarter

[Jai Dee]

Thai Q3 GDP accelerates from previous quarter

BANGKOK, Dec 4 (Reuters) - Thailand's economy grew a seasonally adjusted 1.5 percent in the third quarter, its fastest expansion in a year, the state planning agency said on Monday.

Five economists surveyed by Reuters had estimated gross domestic product rose 1.1 percent in the third quarter, supported by healthy exports, compared with revised second-quarter growth of 1.1 percent.

Third-quarter GDP was 4.7 percent higher than a year earlier, down from a revised 5.0 percent annual rise in the second quarter but above market expectations of an increase of only 4.1 percent, agency data showed.

"The economy performed well in third quarter, boosted by exports even though domestic demand and investment slowed," Ampon Kittiampon, head of the National Economic and Social Development Board (NESDB) planning agency, told reporters.

Private investment was disrupted by brief uncertainty in the wake of Thailand's bloodless coup on Sept. 19, and property sales dropped due to high interest rates, Ampon said.

Most analysts were surprised by the robustness of the economy in the third quarter as the ouster of Prime Minister Thaksin Shinawatra proved only a minor blip.

"Significantly better than expected," Standard Chartered Bank economist Usara Wilaipich said. "The Q3 GDP at 4.7 percent should ensure the expectations that the Bank of Thailand will hold rates unchanged at 5 percent at the next meeting next week," are met.

The bank's Monetary Policy Committee is due to review its policy rates on Dec. 13.

"The Q3 GDP growth was higher than our expectation of 4.0 percent. The 2007 GDP outlook is line with our forecast," Thanomsri Fongarunrung of Phatra Securities said.

"All in all, this is good for investment sentiment and should help Thai stocks continue an upleg," she said.

Thai stocks, which have risen about 5.1 percent since the coup, barely reacted to the GDP data, dipping 0.41 percent in early trade.

The third-quarter expansion was the biggest since the third quarter of 2005, when the economy grew 1.9 percent from the previous three months.

The NESDB forecast GDP growth of 5.0 percent for the full year, compared with a range of 4.2 percent to 4.7 percent in a forecast it made in September.

Economists forecast full-year growth of 4.7 percent for 2006, up from 4.5 percent in 2005.

The planning agency predicted slower GDP growth of 4.5 percent in 2007 on expectations that slowing global demand, especially in the United States, would hurt Thai exports.

The impact of weaker global trade and slowing domestic consumption and investment would be more pronounced in the next few months, analysts said.

The NESDB data showed private investment in machinery and production capacity fell 1.5 percent in the third quarter from the second quarter after a 0.8 percent decline in the previous three months

Last week, the Finance Ministry kept to its 2006 economic growth forecast of 5.0 percent despite expected slower investment and consumption after almost a year of political tensions.

The Bank of Thailand forecast in October that the economy would grow between 4.5 percent and 5.0 percent.

Source: Reuters - 4 December 2006

[Jai Dee]

NESD anticipates that GDP this year will stay at 5.0 percent

National Economics and Social Development (NESD) anticipates that Gross Domestic Products (GDP) in this year will stay at 5.0 percent, an increase from 4.2 percent to 4.7 percent. He said that GDP next year will grow at 4.5 percent.

GDP in the third quarter in this year will grow at 4.7 percent and the total average GDP growth will stay at 5.3 percent. The increase in GDP has been attributed to export figures of products and services. He said that the national economy is seeing more stability while inflation rate has improved.

Although the interest rate has increased, liquidity remains high.

Source: Thai National News Bureau Public Relations Department - 4 December 2006