Fiscal Policy Office holds 2011 Thai economic growth forecast at 4.5 per cent

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BANGKOK, June 29 – Thailand’s Fiscal Policy Office (FPO) has maintained the country’s Gross Domestic Product (GDP) projection at 4.5 per cent for this year, FPO Director-General Naris Chaiyasoot said on Wednesday.

The latest growth projection was unchanged from the previous forecast in March.

The GDP growth in the second quarter of this year is likely to grow by only 2.5-3.5 per cent.

Mr Naris said GDP growth this year was driven by domestic and overseas demand.

Private consumption will continue to rise by 4.3 per cent due to good income and an improved employment rate as well as expanded exports and services.

The economy is stable and headline inflation is projected to stay at 3.8 per cent due to rising consumer goods and oil prices.

Oil prices are forecast to stay at 101 US dollars per barrel, but the interest rate policy is likely to be raised again by the end of this year to 3.5 per cent, while the Thai baht is projected to stay at 30.50 baht against the US dollar.

Export values will expand dramatically by 17.6 per cent as the economies of Thailand’s trade partners and Asian countries in general will continue to grow–in particular China with a 9.2 per cent growth projection.

The value of Thailand’s imports will expand by 20.8 per cent. The current account surplus will slightly drop to $12.3 billion because the trade surplus is forecast to fall slightly to $10 billion.

The FPO, however, will closely monitor any adverse affect from global economic activity and the Greek debt crisis, which are key risk factors to Thai economic growth in the remainder of the year. (MCOT online news)