Thailand's domestic demand continues to expand at a resilient pace, albeit partly helped by a low base due to last year's floods, according to Bank of Thailand's November economic report released today.
"On a sequential basis, the economy is moving to more sustainable levels and the drag from weak external demand in the third quarter is starting to reverse. Reflecting an increasing focus on consumer credit, overall credit growth momentum is moderating," said Rahul Bajoria, an analyst of Barclays Research.
According to the central bank, investment demand has continued to expand, supported by increased construction activity and more investment in plant and machinery. Private consumption is also rising at a faster pace, up 1.8 per cent month on month in November after October's 0.4 per cent rise.
"We believe private consumption will remain stable in the coming months, given strong fiscal support from rural spending. Manufacturing activity bounced back in November, but the recovery has been weaker on a momentum basis," Bajoria said in a research note.
The manufacturing sector saw strong growth in November, led by auto production, which remains solid. Tourist flows also remain high, with November's sequential growth being the highest in 10 months.
The current account posted a surplus of US$392 million in November, as the customs trade balance improved at the margin. The overall balance of payments recorded an inflow of $1.2 billion.
Barclays continues to see modest balance of payment surpluses as being supportive of the Thai baht, which is expected to appreciate to 30 per US dollar by the end of 2013.
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Article source: http://www.thethailandlinks.com/2013/01/01/domestic-economy-shows-healthy-growth-in-november/
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