Exports for 2019 to go into reverse, says Siam Commercial Bank
Thailand’s exports are set to contract by 1.6 per cent year-on-year, due to the US-China trade conflict, predicted Siam Commercial Bank’s Economic Intelligence Centre (EIC) on Tuesday,
The centre adjusted down their April export forecast of 2.7 per cent growth, to a new negative forecast of 1.6 per cent contraction.
The EIC also adjusted down their GDP forecast from 3.6 per cent made in April to 3.3 per cent.
The uncertainty from the trade war and the slowdown in the global economy has damaged investment sentiment in the country, said Yunyong Thaicharoen, first executive vice president and head of the EIC.
This has led the centre to predict that private investment will slow down in the second half of 2019.
Public investment in infrastructure projects is still held by the EIC as a key driver of growth and is expected to grow by 7 per cent in 2019.
However, due to budget delays, investment in new projects toward the end of the year may face delays, Yunyong said. The slow pace of post-election Cabinet formation has delayed budget creation.
With regard to monetary policy, the EIC predicted that the central bank will hold the policy rate at 1.75 per cent, with the likelihood to lower rates by 0.25 per cent if Thailand’s economy slows down at a faster pace than expected.
