BoT raises full-year forecast

Populist measures will bolster consumption

Published: 19 Jan 2013 at 00.00
Newspaper section: Business

The Bank of Thailand has unveiled a more positive economic growth forecast for this year, expecting the government's tax rebates on cars, income tax reduction and wage hike to boost consumption and investment in machinery and factories.

The central bank expects exports will begin to improve in the second half of the year, in line with a more stable world economy.

Advancing public debt resolution has lowered the chances of Greece leaving the euro zone, while US success in avoiding tax increases and spending cuts have brightened the global economic outlook.

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boons
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Discussion 2 : 19 Jan 2013 at 16.522
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D1: Yes indeed. The problem is that "growth" is due to credit-growth, which in turn is fueled by hot money inflows. That same credit-growth also poses risks to financial stability. In other words, growth and growing-instability are closely tied in this expansion. Which is why the smart money is running into the equity markets to enjoy a very quick ride, and is ready to pull out at a moments notice. (And they will). The collapse, when it comes will be swift and devastating. And the BoT will once again be caught off guard. Thailand is an 80% export economy with rising wages in a world of decreasing imports. Good luck with that.
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phetpeter
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Discussion 1 : 19 Jan 2013 at 13.071
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See! Every thing is fine, There are no problems, No higher prices, No unemployment! BOT says so, then they took of the rose tinted glasses to wipe away a happy tear and slipped out with...expects the volatility of capital flows and acceleration of credit growth and household debt to pose important risks to financial stability.
Opps!
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BoT raises full-year forecast | Bangkok Post: business