In contrast to past global tightening cycles, Thailand’s capital markets remain in good shape thanks to much higher foreign reserves and low foreign debt, reducing any immediate pressure to match U.S. rate hikes, said the Bank of Thailand.
The BOT forecasts economic growth of 3.3% this year after seeing 1.5% growth last year. It also predicts 6 million foreign tourist arrivals this year and 19 million next year as pandemic-era curbs ease.
Policymakers have promised that fiscal and monetary settings will continue to support the nascent recovery as vital tourism lags without Chinese tourists, who are unable to visit due to stringent travel restrictions that ban outbound travel.
China accounted for over a quarter of the 40 million foreign visitors in pre-pandemic 2019.
Thailand has not seen any net capital outflows this year – instead, its bond and stock markets have drawn net inflows of 157 billion baht.
The government also assured that it is not overly concerned with the weak baht, which it noted has been greatly beneficial for the competitiveness of Thailand’s massive export and tourism sectors. (NNT)