Thailand GDP Growth Below Estimates in Q3

Thailand’s gross domestic product expanded 3.2 percent from a year earlier in the third quarter of 2016, compared to a 3.5 percent expansion in the previous period and market expectations of a 3.4 percent growth. Private consumption, investment and exports were the main drivers of growth while government spending declined sharply.

In the three months to September, private consumption grew by 3.5 percent, compared to a 3.8 percent increase in the preceding quarter. While expenditure on durable and non-durable goods, particularly for vehicles and furniture purchased by households eased, spending on semi-durable goods declined. 

Gross fixed capital formation advanced by 1.4 percent (from +3.2 percent in the June quarter). Public investment rose 6.3 percent (from +11.9 percent).

Exports grew by 3.4 percent, following a 2 percent increase in the June quarter. Imports fell 1.3 percent (from -1.6 percent).

In contrast, government spending shrank 5.8 percent (from +1.5 percent).

On the production side, the non-agricultural sector expanded by 3.2 percent, slowing from a 3.8 percent increase in the June quarter, Agriculture sector also grew  by 0.9 percent, following a 1.2 percent fall in the previous quarter. Growth in non-agriculture sector was seen for: mining and quarrying (+2.9 percent from +1.5 percent in the previous quarter); manufacturing (+0.9 percent from +2.1 percent); electricity, gas and water supply (+6.1 percent from +7.2 percent), construction (+5.0 percent from +7.8 percent); wholesale and retail trade; repair of motor (+5.5 percent from +5.5 percent); hotels and restaurants (+15.9 percent from +12.7 percent);  transport, storage and communication (+6.4 percent from +4.4 percent), financial intermediation (+4.4 percent from +4.6 percent); real estate services (+1.8 percent from +2.8 percent);  health and social work (+1.9 percent from +5.2 percent), other community, social and personal service (+10.3 percent from +10.5 percent) and private households with employed persons (+2.4 percent from +1.4 percent). In contrast, a decline was seen for: public administration and defence (-3.4 percent from +0.1 percent), education (-2.4 percent from -1.6 percent). 

For 2016, the Thailand's economic planning agency (NESDB) projected the economy to advance 3.2 percent, compared to a previous forecast range of 3.0 to 3.5 percent. Exports in the year are expected to be flat, following earlier projections of a 1.9 percent drop.

On a quarter-over-quarter seasonally adjusted basis, the GDP grew by 0.6 percent, compared to a downwardly revised 0.7 percent expansion in the previous three months. It was the weakest growth since the June quarter 2015 and slightly below market consensus of a 0.7 percent expansion.

For 2017, GDP is projected to expand between 3.0 to 4.0 percent while exports rose 2.4 percent.

In 2015, the economy grew by 2.8 percent.

Thailand GDP Growth Below Estimates in Q3

NESDB l Rida Husna |
11/21/2016 8:49:01 AM