Due to the coronavirus (COVID-19) outbreak, the Thai economy would contract significantly in 2020 and headline inflation would become negative, said the Bank of Thailand in a Press Release.
Nonetheless, the financial system was sound overall, with financial markets starting to function normally. Headline inflation is also forecast to contract in negative value with -1 per cent instead of 0.8% previous projections.
Policy rate at 0.75 percent
The Committee viewed that targeted measures designed to address liquidity needs would be of great importance. Most members thus voted to maintain the policy rate at this meeting. However, two members voted to cut the policy rate by 0.25 percentage point due to the significant economic contraction.
The Committee viewed that the Thai economy would markedly contract in 2020 as tourist figures and merchandise exports were severely affected by the COVID-19 outbreak, the slowdown of trading partner economies, and supply chain disruptions in many countries.
For 2021, Thailand’s central bank expects the economy to bounce back with growth of 3 per cent.
Thailand relaxes COVID-19 measures to help revive economy
During the past couple weeks, new infection cases have been down from roughly 20,000 daily cases to 17,000 -19,000. Moreover, the number of daily discharges is exceeding infections, which has led to the conclusion that the situation is improving.
Thailand relaxed more virus related social curbs on September 1st, in dozens of cities including Bangkok, in a move that may indicate that the country’s economy, hit hard by COVID-19 will soon revive, lead by the export sector and sound financial fundamentals.(more…)
Southeast Asia to relinquish its lead over Latin America says Moody’s
While the emerging economies of Southeast Asia have outperformed their counterparts in Latin America for most of the past two decades, their lead will slide in the next few quarters as Southeast Asian governments clamp down to fight the pandemic’s lingering second and third waves.
The Delta surge is casting larger clouds over the global recovery and emerging markets are in the thick of it. Despite the ebbing of the coronavirus variant in India, where it first emerged, its spread in Southeast Asia, Africa, and the Middle East has steepened the road to recovery in these regions.(more…)
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