By Rahul Trivedi
BENGALURU- Thailand’s economic growth likely gathered a bit of pace in the second quarter thanks to higher government spending, but a tepid recovery in tourism and high household debt cloud the overall outlook, according to economists polled by Reuters.
Southeast Asia’s second-largest economy was forecast to expand 2.1 percent in the April-June period, median prediction in the Aug. 8-15 poll showed, up from 1.5 percent in the preceding quarter.
On a quarterly basis, gross domestic product (GDP) likely grew a seasonally adjusted 0.9 percent from 1.1 percent in the first quarter, a smaller sample of forecasts showed.
Forecasts for the data due on Aug. 19 range from 1.8 percent to 2.8 percent .
“For Q2, government spending and investment, which rapidly accelerated, should … drive economic growth. There could be some slowdown in private consumption amid high household debt, as well as in exports of services,” said Poon Panichpibool, a markets strategist with Krung Thai Bank.
“I still have some concerns about potential impacts from a global economic slowdown, especially in the case of (a) US economic recession, which could hamper Thailand’s exports.”
The outlook darkened on Thursday with a court dismissing Prime Minister Srettha after less than a year in power, prospect of more uncertainty in a country dogged by coups and court rulings that have brought down multiple governments and political parties.
Last month, the World Bank downgraded Thailand’s 2024 GDP growth forecast to 2.4 percent from 2.8 percent , citing weaker-than-expected goods exports and public investments. – Reuters
