BOT to revise GDP forecast next month

Economy May 28, 2014 00:00

By Erich Parpart
The Nation

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The Bank of Thailand says it will adjust its growth forecast for the Kingdom's gross domestic product in mid-June.

Roong Mallikamas, spokeswoman for the central bank, said it would revise the growth projection at the meeting of its Monetary Policy Committee on June 18. Since the forecast will include the latest political and economic developments, the BOT will have to wait for the situation to become clearer before it can make a meaningful projection.
“It is too soon to give out projection numbers because we have to consider the direct and indirect impacts, such as the confidence level of the private sector,” she said.
Kobsak Pootrakool, executive vice president of Bangkok Bank, said he believed the economy would be able to grow by 2-3 per cent if there is a functioning government in the second half of the year. With more certainty on the political developments, consumers and investors would have more confidence, and since they have been holding off on their spending, people should have more than enough purchasing power by the latter half.
Capital market 
As for developments in the capital market, Charamporn Jotikasthira, president the Stock Exchange of Thailand, said the bourse had always been in constant contact with foreign investors and had been keeping them up to date on the political situation in an effort to maintain their confidence.
“There is need to inform investors abroad on the development of the situation here and it is the duty of the SET to make sure that the securities companies in Thailand have correct and synchronised information before they provide it to foreign investors,” he said. 
He commented that the level of sales by foreign stockholders in the days immediately after the coup was not high when compared with some other countries in the region.
Paiboon Nalinthrangkurn, chairman of the Federation of Thai Capital Market Organisations, agreed with the SET president that foreigners’ net sales in the past few days were nothing to worry about even though there was some panic at the start.
“There were some concerns from foreign investors at the beginning stages but after they gained back their  [understanding] from the information at hand, the wariness subsided,” he said.
However, Paiboon still believes that in order to bring back a state of normalcy within the economy and the capital market, it is essential to restore the full confidence of investors.
He said the economy and investment in the second quarter would continue to slow down, since export recovery is still sluggish and there is no clear economic picture from the National Council for Peace and Order, as the junta calls itself. But as soon as there is a clear road map and a functioning government, the economy should be able to pick up by the second half.