Thailand witnessed net capital inflows of US$2.17 billion (Bt70 billion) in June amid accelerating economic indicators following the end of political unrest, according to the Bank of Thailand.
Mathee Supapongse, director of the central bank's domestic economy department, said that all indicators showed improvement except the tourism sector, which dropped slightly from the same period last year.
"The sector showed a strong recovery sign. Tourist arrivals dropped only 0.2 per cent on year, but increased 14.8 per cent from May. The hotel occupancy rate also rose, from 34.3 per cent in May to 37 per cent," he said. However, tourism revenue increased only slightly, as the average stay dropped from 10 days in June last year to eight and a half days.
Domestic consumption, as shown by the private consumption index, rose 8.3 per cent on year and 2.7 per year on month. In June, Thailand also experienced a record high monthly export value, at $17.88 billion, while all export sectors enjoyed an increase in light of the broader base of export markets.
The private investment index also jumped 21.2 per cent on year and 0.8 per cent on quarter, with new machinery investment to cope with renewed orders, particularly in the electronics, electricity and automobile sectors.
Investment in the construction sector also improved in line with new commercial and residential development, especially in the Northeast and Bangkok. Public spending through the Thai Khemkhaeng stimulus package continued.
In line with increasing domestic and overseas demand, industrial production growth also accelerated. Manufacturing output rose 21.3 per cent from a year earlier, after a revised 17.5 per cent gain in May.
Industrial output expanded 21.3 per cent on year. Meanwhile, agricultural prices advanced 39.6 per cent on year, thanks to the higher prices of vegetables, fruits, rubber and tapioca. Farmers' income expanded 50.1 per cent on year.
"The capacity utilisation and production momentum in the exportoriented sectors are quite strong," Rahul Bajoria, an economist at Barclays Capital in Singapore, told Bloomberg. "The momentum is likely to slow down in the second half as global growth indicators moderate, but will remain sticky. We see upside risks to our 6percent growth target in 2010."
The central bank last week raised its forecast for Thai economic growth this year to as much as 7.5 per cent, which would be the strongest pace since 1995. A rebound in overseas sales has limited the impact from the deadly political protests.