SCB’s Economic Intelligence Center (EIC) has released its latest forecast, indicating that the Thai economy at the end of 2020 will have grown by 2.7 percent, showing a s recovery from just 2.5 percent economic growth in 2019, thanks to a better performing export sector and improved global economy.

Earlier this week the World Bank also downgraded Thailand’s economic growth outlook for this year to 2.7% .

The EIC expects the Bank of Thailand to maintain the policy rate at 1.25 percent per annum. The center is keeping a close eye on uncertainties between the U.S. and China; the U.S. and EU; the U.S.-Iran conflict; Brexit, and the financial fragility in households and businesses.

The forecast indicates that the Thai economy will still face challenges from the strong Thai baht currently between 29.5 and 30.5 baht per U.S. dollar; the slowdown in consumption and private investment; employment issues; household debt, and the drought disaster.

In 2019, declining exports and growing weaknesses in domestic demand weighed on Thai economic growth.

The baht, which has appreciated by 8.9% since last year, has also dealt a blow to international tourism and merchandise exports, the World Bank said.