Economic Research
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15 February 2017
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Thailand
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Economic
Update
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Thailand’s CPI grew 0.2% in 2016,
rebounding from a 0.9% fall the year before. The reversal was driven mainly
by a sharply slower decline in energy prices, as well as higher food costs.
Core CPI slowed to +0.7%, as consumers remained wary of the volatile external
demand.
Going forward, we envisage for
inflation to rise 1.5% in 2017, compared to +0.2% last year, underpinned by:
i. Higher food and energy prices;
ii. A pick-up in discretionary spending
as consumer confidence grows in line with the expanding economy.
The small rise in inflation is not
expected to dampen consumer spending and will likely be beneficial for
private investment, thus we expect the Bank of Thailand’s (BOT) to maintain
its key policy rate at 1.5% in 2017.
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Wednesday, February 15, 2017
Rising Demand To Reinforce Ongoing Reflation Climb
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