In November, private consumption and investment showed expansion in Thailand, although exports experienced slower growth compared to October. As a result, the country recorded a current account deficit of $1.2 billion, following a surplus of $700 million the previous month, according to the Bank of Thailand (BoT).
The BoT reported that exports increased by 3.9% year-on-year in November, a smaller growth rate compared to the 7% increase observed in October. The decline in revenue generated by foreign tourist arrivals and a decrease in manufacturing contributed to the current account deficit.
Despite these challenges, private consumption showed a 0.8% increase from October, while private investment rose by 1.8%, indicating that domestic demand was expected to continue supporting economic activity in December.
On the other hand, public spending contracted due to delays in the disbursement of capital expenditure caused by the delay of the 2024 fiscal budget. However, investments by state enterprises expanded, particularly in the transport and utility sectors, leading to higher disbursements for related projects.
In terms of inflation, headline inflation declined as government subsidies helped to manage fuel and electricity prices, alongside a decrease in global crude oil prices.
Thailand’s economy, the second-largest in Southeast Asia, grew by 1.5% in the July-September quarter compared to the same period last year. This growth rate was the slowest recorded this year and fell below expectations, primarily due to weak exports and government spending.
In a separate report, the BoT noted that the ratio of household debt to gross domestic product (GDP) slightly increased to 90.9% at the end of the third quarter, compared to a revised 90.8% in the previous quarter. The total amount of debt also rose to 16.2 trillion baht at the end of September.
Both the BoT and the government have expressed concerns about the high level of household debt relative to GDP, as any ratio above 80% is considered worrisome. Efforts are being made to address this issue and reduce the debt burden on households.
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