The Bank of Thailand (BOT) has reported that the Thai economy is facing several challenges due to global volatility but is still on its way to recovery. Despite the slowdown’s impact on Thai exports, the country’s economy will be sustained by resurgence in private consumption and tourism.
According to BOT Governor Sethaput Suthiwartnarueput, any further interest rate hikes will be gradual and calculated, and the BOT is ready to adjust the pace if necessary. He noted that, unlike other economies, aggressive rate hikes are not appropriate for Thailand as it is still in its early stages of recovery and inflation is lowering.
The BOT is aiming for inflation to return to its target range of 1-3% in the latter half of 2023, having already raised its key interest rate by 75 basis points since August 2022.
Sethaput added that while there might be risks in the growth outlook in 2023, the chance is high that growth within the country would still be more than 3%. He noted, however, that the high household debt could disrupt the economy and needs to be brought down to sustainable levels.
The BOT is now forecasting that the economy will expand by 3.7% in 2023. (NNT)
