Oct GDP 'presages better Q4'
The economy last month - the first in the fourth quarter - revived as targeted and this quarter should be better than the third thanks to the expected improvements in all sectors, according to the Fiscal Policy Office.
However, the FPO maintains its forecast for whole year that gross domestic product will grow by just 1.4 per cent.
The office also firmly believes the economy would expand in line with its projection of 4.1 per cent in 2015.
"The economic outlook in first month of the fourth quarter has shown signs of improvement from the previous month. The fourth quarter’s economic expansion should be better than the third quarter since the remaining months should also be better than the expansion in October," Kritsada Jinavijarana, director-general of the FPO, said yesterday.
"Our projection for the third quarter is similar to the NESDB’s real number but the real number in the third quarter and the improvement in the first month of the fourth quarter will not change our projection for the whole year," he said, referring to the National Economic and Social Development Board.
The economy this quarter should be able to expand by more than 4 per cent thanks to the signs of improvements last month.
The growth momentum should carry forward to the remaining months of the year, as public and private investment, consumption and spending along with exports and tourism all did better last month.
Private consumption has picked up. The collection of value added tax has increased by 2.8 per cent after seasonal adjustment, which is double the 1.3-per-cent rise in September.
Sales of durable goods have also increased. Passenger-car sales were up 1.4 per cent after seasonal adjustment. Merchandise imports have risen by 0.9 per cent (m-o-m SA) from the same month last year. The Consumer Confidence Index has continued to climb, from 69.2 in September to 69.6 in October, though still below the 100 baseline.
Private investment in October showed signs of improvement after imports of capital goods leaped by 8 per cent after seasonal adjustment, while commercial-vehicle and cement sales also advanced. by 0.8 and 0.4 per cent. (m-o-m SA).
Despite the delay in the stimulus package, government spending has improved and the budget disbursement rate has reached 42.3 per cent.
Government agencies disbursed Bt367.6 billion in October, and Bt14.8 billion of that was for investment.
Inbound tourism has turned around, showing year-on-year growth for the first time in 10 months, from a contraction of 7 per cent in September to a rise of 6.1 per cent in October.
Exports also expanded for two months in a row and October’s rate of 4 per cent year on year was the fastest in the past 21 months.
Kulaya Tantitemit, executive director of the FPO’s Macroeconomic Policy Bureau, said the economy would be driven by all economic engines next year and the expansion should be about 4.1 per cent, as the FPO has projected.
Banthoon Lamsam, chairman and chief executive of Kasikornbank, said this government would have failed if the economy did not rev up by at least 4 per cent next year.
