Thailand's economy is not in a recession and the central bank is expected to keep the policy rate unchanged at 2.5%, Thanawat Polvichai, director of the Economic and Business Forecasting Centre at the University of the Thai Chamber of Commerce (UTCC), said on Sunday.
The Thai economy is not in a recession, according to economist Thanawat Polvichai. (Reuters Photo)
"The Thai economy has not slipped into recession and there are signs that it is growing in line with the global economy," Mr Thanawat said. "If the political situation in the country is stable and the world economy recovers, I believe that exports, tourism, investment and domestic consumption in the country will improve in the first quarter of next year."
He said many economic institutions projected that the economy would grow 5% next year despite the ongoing political tensions and a delay in the government's plan to borrow 2.2 trillion baht for infrastructure development projects.
The economist said the Bank of Thailand's Monetary Policy Committee (MPC) would likely keep its benchmark interest rate at 2.5% due to the unpredictable political situation at this time. The central bank has held the policy rate at 2.5% in the last three meetings and is due to meet next on Wednesday.
"The MPC is expected to raise the policy rate by 0.25% to 0.5% in 2014 because many investors are investing in Thailand," Mr Thanawat said. "The inflation rate is expected to increase 2.5% to 3% next year."
The economy should see growth of 5% to 7% over the next three to five years, he added.