Economic data for July showed improvement compared to the previous month, primarily driven by exports and tourism, according to the Bank of Thailand.
On Friday, the central bank reported on the economic and monetary conditions for July, noting a recovery following a slowdown in June.
Chayawadee Chai-anant, assistant governor for the corporate relations group at the central bank, stated that this improvement was fueled by rising external demand, which is evident in both export figures and tourism revenue.
In July, the number of foreign tourist arrivals, after seasonal adjustments, reached 3.1 million, up from 2.7 million the previous month. The increase was largely attributed to visitors from Malaysia, China, Russia, and Europe, although there was a decline in tourists from the Middle East and India.
Tourism revenue also saw a rise due to higher average spending per visitor, particularly among tourists from Russia and Germany.
The value of merchandise exports, excluding gold and adjusted for seasonal variations, increased by 2.8% month-on-month, with growth observed across several categories. This rise was partly due to precautionary measures taken against potential shipping delays anticipated in the near future, according to the central bank.
Growth in exports was largely supported by electronic products, agro-manufactured goods, and chemical and petrochemical items. However, certain products, such as pickups to Australia, the Philippines, and the Middle East, experienced declines, Ms. Chayawadee noted.
The manufacturing production index also rose month-on-month across various categories, with increased auto production aiding near-term exports, which had been impacted by geopolitical tensions in the Middle East.
The rubber and plastics sectors reported positive growth, while machinery production—particularly electric motors and transformers—also increased.
Conversely, petroleum output decreased after expanding the previous month, Ms. Chayawadee added.
She highlighted that private consumption indicators for July remained stable compared to June, with a rise in spending on services that aligned with increased passenger transport activities.
However, consumer confidence has continued to decline, influenced by concerns over high living costs, sluggish economic growth, and political instability.
Moreover, business sentiment regarding investment has also dipped, especially within the automotive, real estate, and retail sectors.
On the matter of exchange rates, the baht appreciated against the US dollar, driven by weaker than expected US economic data and easing inflation, as the market predicts potential interest rate cuts from the Federal Reserve. The appreciation of the baht was further pressured by rising gold prices, Ms. Chayawadee stated.
“The central bank is closely monitoring the baht’s movement against the dollar, given the volatility of the local currency. We also observe improved management of foreign exchange risk among local businesses through the use of hedging instruments,” she concluded.
