The Joint Standing Committee on Commerce, Industry and Banking (JSCCIB) has taken a more pessimistic view by cutting its forecast range for Thailand’s full-year economic growth, with the lower end now below the 3% mark.
The committee downgraded its economic outlook to a band of 2.9-3.3% from 3.7-4% predicted earlier, Predee Daochai, chairman of the Thai Bankers’ Association, said.
The latest revision is in response to the impact on Thai exports of the US-China trade war, he said. The JSCCIB also slashed its view of the country’s outbound shipment growth to a range of 1% growth to a 1% contraction.
Thailand’s GDP grew by 2.8% year-on-year in the first quarter, down from a revised 3.6% in the fourth quarter of last year and the slowest pace in 17 quarters.
Customs-cleared exports fell by 5.8% year-on-year in May to US$21.01 billion after contracting 2.6% in April and 4.9% in March. For the first five months, exports shrank 2.7%.
Although the country’s export growth is expected to pick up in the second half this year due to a low-base effect, the rebound pace could be slow amid mounting global uncertainties resulting from trade tensions between the world’s two biggest economies, Mr Predee said.
He also has a firming bias on the baht for the rest of the year on the back of the US Federal Reserve’s dovish signals.