It’s good to be good !
-The Bank of Thailand (BOT) forecasted headline inflation would reach an 11-year high at 7.5-8.8 per cent, while core inflation would break the policy target to 2.8-3.8 per cent this year marking the first time since inflation targeting was introduced in 2000.
-The Kingdom’s economic growth forecast, however, was revised slightly lower to 4.8-5.8 per cent from 4.8-6 per cent. (Nation)
The last inflation revision was end of april… When the BOT increased its forecast from a surreal 4 % to 5 % for the whole year.
High inflation has apparently eroded consumption and investment while exports could grow higher than expected, thanks to global demand.
No it’s not “apparently” it’s “obvious“… Inflation (at least, the form we currently experience) leads to declining purchasing power.
The BOT estimated total consumption to grow 3-4 per cent this year, compared with a previous forecast of 4.5-5.5.
Total investment is projected to expand 4.3 – 5.3 per cent, lower than 8.5-9.5 per cent in earlier projection.
Still those projections could be lowered again. I mean it’s a sign that the total investment projection has been divided by 2 ! The previous ones were delirious, designed for a rozy world full of confidence, mega-projects, and small kids laughing in Wonderland etc.
The reality for businesses is totally different : uncertainty (on the political front and the economy as well), higher interest rates, running inflation/costs, high competition (difficult sometimes to increase prices, or even forbidden due to gvt prices controls policy), and bad perspectives for exports (obvious slowdown in US and UE, again the BOT is dreaming when talking about a continuous higher global demand !), etc.