According to Bot latest Press Release, the Thai economy continued to be on a decelerating trend in October. The value of merchandise exports continued to contract, mainly due to the economic slowdown of trading partners, consistent with deterioration in manufacturing production and private investment indicators.
Public spending contracted after last month’s expansion, from capital expenditures. However, private consumption indicators expanded at a higher pace compared with the previous month after temporarily benefiting from the government’s economic stimulus measures. The tourism sector also continued to expand well.
On the stability front, headline inflation edged lower on the back of falling energy prices while core inflation held steady. The seasonally adjusted unemployment rate slightly decreased, in line with the rising number of employed persons in agricultural sector. The current account registered a smaller surplus from trade balance. The capital and financial accounts posted a deficit from the asset position.
Details of the economic conditions are as follows:
The value of exports dropped by 5.0 percent
The value of merchandise exports, both including and excluding gold, dropped by 5.0 percent compared with the same period last year.
The contraction of exports in several categories was due to
1) the economic slowdown of trading partners;
2) the continued downturn in electronic cycle without clear sign of recovery; and
3) the contraction of global crude oil prices, coupled with the temporary maintenance shutdown of oil refineries, leading to the contraction of petroleum-related products exports, both in terms of prices and quantity.
Nevertheless, the value of exports in some categories, including agro-manufacturing products, electrical appliances, and automotive and parts, continued to expand, partly as substitution for Chinese products in the US market. In addition, the exports of hard disk drive grew for the first time in 12 months, thanks to the relocation of production base to Thailand.
As a consequence of the merchandise exports contraction, manufacturing production continued to decline.
Private investment indicators continued to deteriorate
Private investment indicators continued to deteriorate from the same period last year, in line with weak domestic and external demand. Investment in machinery and equipment continued to contract from imports of capital goods, domestic machinery sales, and the number of newly registered motor vehicles. Meanwhile, investment in construction declined from permitted construction area in almost every purpose, consistent with subdued construction…