Bank of Thailand fears weak baht pressures inflation soaring affect people’s cost of living increase the cost of imports hurriedly keeping a close eye on The Thai economy in March slowed down after weak consumption and investment. From the Omicron epidemic-oil soaring
29 Jun 2022 – Mr. Sakkapop Panyanukul, Senior Director Macroeconomic Department The Bank of Thailand (BOT) revealed that Thai economic indicators in the first quarter of this year have a tendency to improve from the fourth quarter of 21, although in March, private consumption has softened somewhat. from the epidemic situation of COVID-19 More intense omikron species including the trend of rising cost of living which was fully affected by the rising energy prices.
In addition, the Bank of Thailand is in the process of monitoring the depreciation of the baht. It is expected that from now on there will be more intense volatility. by the beginning of the year The baht depreciated by 2.5%, which is still mid-range, although it has a positive effect on exporters. But in terms of imports, there are concerns that the cost will be higher. resulting in higher inflation and affect the cost of living of the people which at the moment has not had much effect on the economy But if the baht continues to depreciate It will be even more pressure. aggravate inflation in the next period
“The Bank of Thailand is in the process of monitoring the changes in the baht. if there is an abnormality inconsistent with economic fundamentals will have to take care by the depreciating baht This comes from the case of the US Federal Reserve (Fed) raising interest rates more strongly and faster than expected. including concerns about the recovery of the Chinese economy which looks forward The baht is still highly volatile,” said Mr. Sakkapop.
In terms of inflation The Bank of Thailand is closely monitoring As predicted in 2Q23/2022, there is a chance that headline inflation will rise above 5% before starting to decline in 4Q22, based on the diesel price float. and the increase in the prices of various types of products, in which the core inflation in the month In March, there was an accelerated increase in energy prices and ready-to-eat food prices, which the Bank of Thailand had to continuously monitor.
Mr. Sakkapop also said that the Thai economy in March 2022 slowed down slightly. This was in line with the decline in private domestic expenditure in both consumption and investment. Public expenditure slightly contracted due to both current and federal investment expenditures. However, merchandise exports rose in line with demand from trading partners. while the number of foreign tourists continued to increase after the relaxation of international travel restrictions
economic stability Headline inflation increased from rising energy prices in line with world crude oil prices. and the price of ready-to-eat food that increases in accordance with the cost of raw materials The labor market has improved somewhat. but overall still fragile As for the current account, the balance returned to a surplus in line with a trade surplus which increased from Q1/22. The Thai economy improved from the previous quarter. This was in line with the increase in product export value due to improving demand from trading partners. The number of foreign tourists increased after The easing of international travel restrictions. In addition, indicators of private consumption and investment also increased. Despite some slowdown due to the COVID-19 outbreak
