Thailand’s economic recovery “remained on track” in September with higher income from tourism but lowered manufacturing output, the Bangkok of Thailand (BoT) said.
The Thai economy in Q3 of 2022 also continued to improve from Q2 with more than 3.6 million foreign tourists in Q3 compared to nearly 1.6 million in Q2.
“The economy continued to recover in September, mainly from tourism but there are also slowdowns in some areas such as the manufacturing sector,” said Chayawadee Chai-Anant, BoT’s Assistant Governor.
“For the 3rd quarter, the economy continued to improve from the previous quarter which was as expected continued recovery in the tourism sector and domestic demand with a slowdown in export,” she said.
She said service sectors improved from August, thanks to increases in foreign tourist figures, especially for short-haul travelers such as the ones from Malaysia and Singapore.
There were 1.3 million foreign tourists in September compared to 1.1 million in August.
Domestic demand continued to expand from higher tourist income and stable consumer confidence.
Private investment slightly slow down but it is still on a recovering path, Chayawadee said.
Exports improved in September when compared to the past few months in various categories including the export of hard disk drives, which increased in line with the delivery cycle.
The export of agricultural products also improved after a large decline in August.
However, the exports of metals and agro-manufacturing products declined when compared to the previous month.
The Ministry of Commerce said last week that the country’s exports expanded by 7.8% year-on-year to US$24.91 billion in September, beating market expectations of 4.3-4.4%.
For the first 9 months of 2022, exports expanded by 10.6% year-on-year, reaching $221.36 billion.
For private consumption, Chayawadee said its indicators in September remained close to August where spending on services improved from the higher number of foreign tourists but spending on other categories was generally stable.
Private investment indicators in September slightly decreased from August mainly due to lower investment in machinery and equipment as the import of capital goods diminished.
Investment in construction also dropped due to lower sales of construction materials.
However, spending on services improved in September mainly due to the recovery of the tourism sector, while spending on other categories was generally stable compared to August.
Employment and consumer confidence continued to improve which supports household expenditures but the elevated living costs are still affecting domestic consumption.
Manufacturing production declined in September when compared to August, mainly from lower production of automobiles following a good performance in previous months.
The production of chemical products also declined from a slowdown in external demand.
The Ministry of Industry said today that the manufacturing production index (MPI) expanded by 3.36% year-on-year in September, lower than market expectations of around 6%.
Chayawadee saidthe Thai economy continued to improve in Q3 when compared to Q2 with an increase in private consumption and investment while manufacturing production also picked up, thanks partly to improvement in shortage problems of production parts.
The service sector continued to recover on the back of improving foreign tourist figures.
There were 3.61 million foreign tourists in Q3 compared to 1.58 million in Q2.
However, exports declined in Q3 when compared to Q2, due to a slowdown in trading partners’ demand coupled with supply-side problems such as inventory management of the oil refinery and flooding.
The labor market gradually improved and the current account registered a smaller deficit due to a lower deficit in the net service, income, and transfer balance.
Headline inflation declined in September when compared to August, thanks to lower domestic retail oil prices.
For Q3, headline inflation increased from fresh food prices and core inflation.
The headline consumer price index (CPI) was at 107.7 points in September, up 6.41% year-on-year and increased by 0.22% when compared to August.
The CPI was at 4.7%, 7.1%, 7.66%, 7.61% and 7.86% in April, May, June, July and August, respectively.
The Baht remained “stable” in September when compared to its movement in August, Chayawadee said.
The currency remained weak as it was trading around 38 Baht per USD on Monday afternoon.