Thailand’s economy grew by 1.5% in the third quarter, marking a slowdown for the second consecutive quarter. This figure was lower than the 2.4% predicted by economists and below the 1.8% growth seen in the previous quarter. The decline in growth was attributed to several factors, including public spending, inventories, and goods exports. However, private consumption and tourism remained strong.
The country’s new prime minister, Srettha Thavisin, took office in late September and faced the challenge of leading the country to long-term economic recovery amidst political turmoil. Despite optimism surrounding a future of tightening monetary policies, weak GDP figures for the third quarter intensified concerns about the country’s economic outlook.
In response to the weak GDP figures, the Bank of Thailand raised its key interest rate for the eighth straight time in September and expected growth and inflationary pressures to accelerate in the coming year. However, analysts at Nomura predict a pause in the central bank’s policies in the near term, with the possibility of rate cuts by the second quarter of 2024. The government may also consider implementing large digital wallet handouts to boost economic growth, which could impact the Thai baht. The currency has already weakened against