Latest news with #ChamadanaiMarknual
Business Times
6 days ago
- Business
- Business Times
Economists cut Thai, Malaysian growth forecasts on trade turmoil
ECONOMISTS have slashed forecasts for growth in Malaysia and Thailand as the export-dependent economies grapple with US President Donald Trump's global trade war. Thailand's gross domestic product is set to expand by 2.1 per cent in 2025, according to the median prediction of 27 economists Bloomberg surveyed in May. That's lower than the 2.8 per cent expected in a February survey, and below last year's 2.5 per cent growth. 'We see the economy would slow down over the next few quarters since the negative impact of trade war would kick in,' Krung Thai Bank's first vice-president Chamadanai Marknual said. Foreign tourists arrivals are also likely to be lower than anticipated, and there will be limited room for additional fiscal stimulus, he said. Malaysia's 2025 GDP is seen expanding just 4.1 per cent, according to the median estimate of 28 economists polled. That's down from a February forecast of 4.7 per cent and a full percentage point slower than last year's expansion of 5.1 per cent. Second-quarter growth is expected to come in at 4.2 per cent, from a prior forecast of 4.5 per cent. 'Malaysia's economic growth is set to moderate further over the course of 2025,' Han Teng Chua, senior economist at DBS Bank, said, adding that exports will face headwinds from heightened global trade tensions. The surveys underscore the extent to which South-east Asia, one of the world's fastest-growing regions, is being hit by both levies on exports to the US and the broader slowdown in global trade. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up In Malaysia, domestic demand will remain resilient due to supportive household spending and sustained investment expansion, Chua said. Inflation is contained, likely providing room for Bank Negara Malaysia to loosen monetary policy in the second half of this year, the economist said. Malaysia's central bank said earlier this month that it has policy room to act, as it expects growth to fall below the official forecast this year. The Thai economy will probably post growth of 2.4 per cent in the second quarter from a year earlier, down from the previous forecast of a 2.8 per cent expansion. Earlier this month, Thailand's National Economic and Social Development Council said GDP will likely expand in a range of 1.3 to 2.3 per cent in 2025, with growth constrained by high household and corporate debt burdens. BLOOMBERG
Reuters
17-02-2025
- Business
- Reuters
Thai Q4 GDP growth misses forecast, U.S. trade policy poses risks for 2025
BANGKOK, Feb 17 (Reuters) - Thailand's economy grew less than expected into the end of 2024, data showed on Monday, and analysts said hopes of an improving outlook for this year are clouded by concerns that the country's export engine could be hit with U.S. tariffs. Southeast Asia's second-largest economy grew 3.2% in the October-December quarter from a year earlier, up from a 3.0% pace in the previous quarter, the National Economic and Social Development Council (NESDC) said. That missed the median forecast of 3.9% growth in a Reuters poll but was still the strongest annual rate in nine quarters. On a quarterly basis, the economy grew a seasonally adjusted 0.4% in the October-December quarter, below the poll forecast of 0.7% growth and the 1.2% expansion in the prior quarter. "The momentum of the economy is likely to slow down," said Krungthai Bank economist Chamadanai Marknual. "The government needs to quickly introduce measures to support industries, such as the automotive and real estate sectors, to stimulate the economy." The main stock index (.SETI), opens new tab dropped as much as 2.8% to its lowest level in more than 4 years after the data, while the baht fell 0.3% against the U.S. dollar. The economy has lagged regional peers as it struggles under high household debt and borrowing costs, and sluggish demand from China, which is also a key tourism market. Full-year growth came in at 2.5%, the NESDC said, faster than 2.0% growth in 2023, while the growth forecast for this year was unchanged at a range of 2.3% to 3.3%. NESDC head Danucha Pichayanan told a press conference that while government spending, private consumption and investment, tourism, and exports would support growth this year, Thailand's trade surplus with the United States was a risk as President Donald Trump imposes tariffs on trading partners. "It is undeniable that Thailand is also in the spotlight on this matter... and that requires urgent attention to address and find ways to negotiate to reduce the impact on Thai exports," he said, as the agency upgraded its forecast for export growth this year to 3.5% from 2.6%. Capital Economics said while economic growth has slowed, "we are expecting a better year ahead, with loose fiscal policy and further recovery in tourism spending set to be the key drivers". The government is optimistic its signature "digital wallet" stimulus scheme and other measures will stimulate the economy as it aims for 3.5% growth this year. The NESDC maintained its forecast for 38 million foreign tourists to visit this year, below the record of nearly 40 million in 2019, the year before the COVID-19 pandemic. Despite the lower-than-expected fourth quarter growth numbers, Danucha said the economy was expanding and there was no need to cut interest rates at the moment. "We should be calm and wait and see," he added. In December, the Bank of Thailand left its main interest rate (THCBIR=ECI), opens new tab at 2.25% following a surprise quarter-point cut in October. Last month, the central bank governor told Reuters the current policy rate remained suitable, given high household debt, even though growth could be below 2.9% this year. The next policy review is scheduled for February 26. ($1 = 33.61 baht) Get a look at the day ahead in Asian and global markets with the Morning Bid Asia newsletter. Sign up here.
