Economic and Monetary Conditions, September Economic and Monetary Conditions September 2018

Transcription

1 Economic and Monetary Conditions September Monetary Policy Group October

2 Content 1 Executive Summary 1 2 The Thai Economy Supply 3 Agricultural sector Manufacturing sector Service sector Real estate sector 2.2 Demand 5 Private consumption Private investment Fiscal position 2.3 The global economy and external sector 7 The global economy External sector Balance of payments 2.4 Monetary and financial conditions 9 Corporate financing Interest rates Exchange rates 2.5 Financial stability 11 Inflation Labor market External stability 3 Link to related statistics and contents 12

3 1. Executive Summary In September, the Thai economy expanded at a slower pace from the previous month. Domestic demand grew from private consumption, which expanded in most categories, and public spending, while private investment remained unchanged. External demand weakened following the contraction in merchandise exports, in line with the decline in manufacturing production. Meanwhile, the tourism sector slightly expanded mainly from ASEAN tourists. On the stability front, headline inflation decelerated due mainly to fresh food prices. Core inflation accelerated from the previous month. The seasonally-adjusted unemployment rate remained unchanged from last month. The current account registered a higher surplus attributed to the decline in import of gold. The overall capital and financial accounts registered a surplus. Details of the economic conditions are as follows: Private consumption indicators exhibited continual expansion, although at a slightly softer pace compared to the surge in the previous month. The expansion was on the back of increased spending in all categories except non-durable goods, particularly alcoholic beverages and tobacco which contracted due to last year s high base effect stemming from accelerated spending of such products before the increase in excise tax. Moreover, fundamental factors supporting the overall purchasing power slightly improved from more broad-based improvement in non-farm income, while farm income contracted from decreased agricultural prices. Public spending, excluding transfers, expanded from the same period last year. The expansion in current spending was on the back of increased expenditure on goods and services and disbursement of civil servants compensation. However, capital spending contracted from lower disbursement of the Central Fund and high base effect from strong disbursement of the supplementary budget allocated to the provincial clusters. Private investment indicators remained unchanged from the same period last year. Investment in machinery and equipment slightly expanded from domestic machinery sales, while investment in construction contracted from permitted construction area. After seasonal adjustment, private investment indicators declined from last month from investments in both construction and machinery and equipment. The value of merchandise exports contracted at 5.5 percent from the same period last year. Excluding gold, the value of merchandise exports declined by 1.0 percent. The overall contraction was due mainly to accelerated exports of automotive to Australia in earlier periods and the temporary disruption to the transportation of goods to trading partner countries from natural disasters, particularly Japan, Philippines and Hong Kong. In addition, there was a high base effect stemming from last year s surge in the export of mobile phones from the launch of new models; and accelerated export of solar cells and washing machines before the US safeguard measures was put into place. However, export of other product group continued to expand such as petroleum-related products, jewelry and fashion accessories, machinery and equipment, and agricultural products. The contraction in merchandised exports contributed to the decline in manufacturing production, particularly the production of automotive, and rubber and plastics. 1

4 The number of foreign tourist arrivals registered a moderate growth of 2.1 percent compared to the same period last year. This was mainly from the increase in the number of Malaysian tourists, partly from the improved economic confidence after the Malaysian general election and the low base effect from last year s overlap in a holiday period, coupled with the continual increase in the number of Hong Kong, Taiwanese, and Indian tourists. However, the number of Chinese, English, and Russian tourists continued to contract. After seasonal adjustment, the number of foreign tourists remained unchanged from the previous month as the increase in the number of ASEAN tourists was offset by the decline in the number of Chinese tourists. The value of merchandise imports expanded at a moderate pace with a growth of 14.3 percent from the same period last year, mainly from the slowdown in the import of gold. Excluding gold, the value of merchandise imports grew by 12.5 percent. The expansion was from the imports of: (1) raw and intermediate goods, from the imports of crude oil, petroleum products, metals, and electronic parts; (2) consumer goods, mainly from textile and apparel, while import of non-durable goods remained unchanged; and (3) automotive products, particularly passenger cars and automotive parts, in line with the continued improvement in domestic sales. On the stability front, headline inflation decelerated to 1.33 percent from 1.62 percent in the previous month, due mainly to the decrease in vegetable and fruit prices. Meanwhile, core inflation increased from the previous month. The seasonally-adjusted unemployment rate remained unchanged from last month. The current account posted a larger surplus as contributed mainly from the decreased import of gold. The overall capital and financial accounts registered a surplus from the liabilities position. This inflow was mainly from foreign investment, particularly in long term government debt securities, short term loans by depository corporations, and Foreign Direct Investment (FDI) in real estate sector. Overall economic activity in the third quarter of continued to gain traction from domestic demand. Private consumption expanded solidly with growth momentum in most spending categories. Public and Private investment continued to improved. However, external demand weaken as the tourism sector suffered from the Phuket tour boat incident, while merchandise exports also grew at a softer pace, in line with the decline in manufacturing production. On the stability front, headline inflation accelerated mainly from the increase in retail petroleum prices, while core inflation remained unchanged. The seasonallyadjusted unemployment rate slightly decreased from the previous quarter. The current account continued to post a surplus as contributed mainly from trade balance, while the capital and financial accounts registered a deficit. 2

5 2.1 Supply Farm income declined from the same period last year attributed mainly to decreased agricultural prices. Manufacturing production contracted from the same period last year. The overall services sector expanded from the previous month, particularly in trade, business services, and public administration services. (%YoY) Nominal Farm Income H1 H2 Q1 Q2 Q3 Aug Sep Nominal farm incomep Agricultural productionp Agricultural price Note: Farm income does not include government subsidies and transfers. Source: Office of Agricultural Economics and calculated by BOT P = Preliminary data Real Farm Income Index sa ( 2014 = ) Real farm income sa Real farm income sa, 3mma Source: Office of Agricultural Economics and calculated by BOT Manufacturing Production Index (MPI) (%YOY) Weight 2011 H1 H2 Q1 Q2 Q3 Aug Sep P Sep P Sep P (Cont) (%MoM) Food & Beverages Automotives Passenger Cars Commercial Vehicles Engine Rubbers & Plastics Chemicals IC & Semiconductors Textiles & Apparels Cement & Construction Electrical Appliances Hard Disk Drive Petroleum Others MPI MPI sa % from last period P = Preliminary data. Seasonally adjusted by Bank of Thailand Source: Office of Industrial Economics 2014 Manufacturing Production Index (MPI) Index sa ( 2014 = ) 2015 Export < 30% 30% < Export < 60% Export > 60% Source: Office of Industrial Economics, calculated by Bank of Thailand %MoM sa -1.1% -0.5% -1.9% Index sa ( 2014 = ) 2014 Other Manufacturing Indicators 2015 Electricity used in industry Import quantity of raw materials Index of hours worked in manufacturing (3mma) %MoM sa -0.2% -1.6% Source: NSO, OIE, Customs Department and seasonally adjusted by Bank of Thailand 0.8% (%) Weight 2011 Capacity Utilization (sa) Q2 Q3 Q4 Q1 Q2 Q3 Aug Sep p Food & Beverages Automotives Rubbers & Plastics Chemicals IC & Semiconductors Textiles & Apparels Cement & Construction Electrical Appliances Hard Disk Drive Petroleum Others CAPU sa P = Preliminary data. Seasonally adjusted by Bank of Thailand Source: Office of Industrial Economics 3

6 Index sa, 3mma ( 2014 = ) 140 Service Production Index Non-market Services (share 24.8%) 130 Market Services (share 75.2%) 2014 Service Production Index (SPI) 2015 Note : Latest data estimated by Bank of Thailand Market services covering trade, hotels and restaurants, transportation and telecommunication, financial intermediation, real estate, and business services Non-market services covering public administration and defence, education, health, and social work Source: Office of the National Economic and Social Development Board (NESDB), Ministry of Commerce, National Statistical Office, The Revenue Department, The Office of Industrial Economics,and Ministry of Tourism and Sports Index sa, 3mma ( 2014 = ) 130 Trade Sector Transportation Sector Business Services Communication Sector (RHS) Thai Visitors (RHS) Sales from VAT Collection and Other Indicator Index sa, 3mma ( 2014 = ) Note: Sales from VAT collection in trade, transportation, business services, and communication sectors, latest data estimated by Bank of Thailand. Share in GDP : Trade (15.2%), Transportation and Communication (10.3%), Real Estate and Business Services (8.2%) Source: The Tourism Authority of Thailand and The Revenue Department 140 New Mortgage Loans from Commercial Banks in Bangkok and Vicinity Area* Thousand units,sa 25.0 Low-rise residents Condominium Total 20.0 Q3/ Q1 Q1 Q1 * seasonally adjusted by BOT Source: Bank of Thailand 2015 Q1 Q1 Q1 Q1 Thousand units,sa Q1 Q1 Newly Launched Properties in Bangkok and Vicinity Area Low-rise residents Condominium Total Q1 Q1 Q1 Q1 Q1 Source Agency for Real Estate Affairs AREA and calculated by BOT Q3/ Index (2009 = ) 200 Single house 1 Condominium Housing Price index Townhouse Land Q3/ Q1 Q1 Q1 Q1 Q1 Q1 Q1 Source Mortgage loan reported by commercial banks, calculated by BOT 4

7 2.2 Domestic demand Private consumption indicators exhibited continual expansion in all categories, although at a slightly softer pace compared to the previous month. Private investment indicators remained unchanged from the same period last year from investment in machinery and equipment while investment in construction contracted. Public spending, excluding transfers, expanded in current capital spending. Private Consumption Indicators % YoY H1 H2 Q1 Q2 Q3 P Aug Sep P Sep P (%MoM) Non-durable Index Semi-durable Index Durable Index Service Index E.. E. E (less) Net tourist spending Private Consumption Index Note: %MoM is calculated from seasonally adjusted data P = Preliminary Data, E = Estimated Data, R = Revised Data Source: Bank of Thailand Durable Index and Semi-durable Index Index sa, 3mma ( 2014 = ) Source: Bank of Thailand Semi-durable Index Durable Index Index sa, 3mma ( 2014 = ) Nielsen s FMCG Index & Fuel Index Fuel Index P (RHS) Nielsen s FMCG Index excl. Alcohol and Tobacco Index sa, 3mma ( 2014 = ) P = Preliminary Data Source: The Nielsen company and Department of Energy Business, calculated by Bank of Thailand Service Index* & Net Tourist Spending Index Index sa, 3mma ( 2014 = ) Service Index Net Tourist Spending Index** (RHS Index sa, 3mma ( 2014 = ) Note: * Combination of 1) hotel and restaurant VAT and 2) transportation sales ** Expenditure of non-resident in Thailand subtracted by expenditure of resident abroad Source: Bank of Thailand Consumer Confidence Index Diffusion Index, sa (Unchanged = ) Total Current Next 6 months Average 5 years = Source: The University of the Thai Chamber of Commerce, calculated by Bank of Thailand % YoY Permitted Construction Area (9mma) H1 H2 Q1 Q2 Q3 Aug Sep P SepP (%MoM) E. Construction Materials Index Real Imports of Capital Goods Real Domestic Machinery Sales E 2.2 Newly Registered Motor Vehicles for Investment Private Investment Indicators Private Investment Index Note: %MoM is calculated from seasonally adjusted data. P = Preliminary Data E = Estimated Data Source : Bank of Thailand 5

8 Index sa ( 2014=) 140 Equipment Indicators Real Imports of Capital Goods Domestic Machinery Sales Car Registered for Investment Note: E = Estimated Data, All data is in real terms. Source: Department of Land Transport, Customs Department, Revenue Department, calculated by Bank of Thailand Index sa ( 2014=) Construction Indicators Construction Materials Index Permitted Construction Area (RHS) Note: E = Estimated Data, All data is in real terms. Source: NSO and Bank of Thailand 1,000 m 2, 9mma 7,000 6,500 6,000 5,500 5,000 4,500 4,000 Diffusion Index (Unchanged = 50) BSI Source : Bank of Thailand Business Sentiment Index Expected BSI (next 3 months) Dec Sep Central government expenditure (excl. subsidies/grants and miscellaneous other expense) Billion Baht Average Current Expenditure Oct Dec Feb Apr Jun Aug Billion Baht Capital Expenditure Oct Dec Feb Apr Jun Aug Source: Comptroller General s Department and Bank of Thailand Sep Billion Baht (14.2% YoY) Sep Billion Baht (-2.7% YoY) Billion Baht FY FY FY FY P Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Aug Sep Revenue (%YoY) Expenditure 1/ (%YoY) Budgetary B/L Non-Budgetary B/L Cash B/L (CG) 2 Fiscal Position (Cash basis) Primary B/L (CG) Net Financing Treasury B/L Note: P = Preliminary data 1/ Exclude principal loan repayment Source: Fiscal Policy Office Comptroller General s Department Bank of Thailand 6

9 Economic and Monetary conditions, September 2.3 The global economy and external sector The current account posted a larger surplus as contributed mainly from the decreased import of gold. The overall capital and financial accounts registered a surplus from the liabilities position. Index ( 2015 = ) US (Sep 18) Euro Area* (Aug 18) Japan (Aug 18) 2015 Source: Bloomberg Note: *Volume Index G3 Retail Sales Index sa, 3mma ( 2014 = ) Asian Export Performance 2015 Note: Thai export excludes gold. Indonesian export excludes oil and gas. Source: CEIC, Customs Department, calculated by Bank of Thailand KR PH TH MYCN INDO TW SG Aug = 22.4 Bn USD Ex.Gold = 22.0 Bn USD %YoY Share P P Export Growth P P Sep = 20.7 Bn USD Ex.Gold = 20.4 Bn USD H1 H2 Q1 Q2 Q3 Aug Sep Sep (%MoM) Agriculture Fishery Manufacturing Agro-manufacturing Electronics Electrical Appliances Automotive Machinery & Equipment Petroleum Related Total (BOP Basis) Ex. Gold Ex. Gold & Petroleum Related %MoM calculated from seasonally adjusted data. P = Preliminary data Note: Data above are recorded by custom basis, except total export value is recorded by BOP basis. Custom basis considers recording passing through Customs while BOP basis considers changes in ownership between R and NR. Source: Compiled from Customs Department s data Aug = 21.8 Bn USD Ex.Gold = 19.3 Bn USD %YoY Share P P Import Growth P P H1 H2 Q1 Q2 Q3 Aug Sep Sep (%MoM) Consumer Raw material & Intermediate o/w Fuel o/w Raw mat & Interm ex. Fuel Sep = 18.7 Bn USD Ex.Gold = 17.7 Bn USD Capital Others Total (BOP Basis) Ex. Gold %MoM calculated from seasonally adjusted data P = Preliminary data Note: Data above are recorded by custom basis, except total import value is recorded by BOP basis. Source: Compiled from Customs Department s data 7

10 Economic and Monetary conditions, September Financial Account Million USD P P P H1 H2 Q1 Q2 Q3 Aug Sep E YTD 1. Assets TDI Equity Thai portfolio investment Equity sec. investment Debt sec. investment Loans Other investments Trade credits 2 2. Liabilities FDI Equity Foreign portfolio investment Equity sec. investment Debt sec. investment Loans Other investments Trade credits Total financial flows (1+2) Source : Bank of Thailand P = Preliminary data E= Estimated data Balance of Payments Billion USD P P P H1 H2 Q1 Q2 Q3 Aug Sep E YTD Trade balance Exports (f.o.b.) %YoY Imports (f.o.b.) %YoY Services & income Current account Capital and financial account Government Central bank ODCs Others Net error & omissions Overall balance International reserves Net forward position Source : Bank of Thailand E= Estimated data P = Preliminary data %YoY (Share in ) H1 H2 Q1 Q2 Q3 Aug Sep P %MoM sa China (27.6%) Malaysia (9.8%) Asia ex. China & Malaysia (29.6%) Inbound Tourists by Country of Origin Russia (3.8%) Index sa ( 2014 = ) 350 Europe ex. Russia (14.5%) 50 Others (14.7%) Total (million persons). (18.2) (. ) (8.9). (3.2) Source: Ministry of Tourism and Sports Note: denotes share of total tourist arrivals in Inbound Tourists Index Total China (share 28%) Malaysia (share 10%) Asia ex. CN MY (share 30%) Europe ex. Russia (share 15%) Russia (share 4%) Source: Ministry of Tourism and Sports, calculated by Bank of Thailand 8

11 -17 Apr Oct Apr Apr Oct Apr Feb-17 Mar-17 Apr-17 May-17 Jun Aug-17 Sep-17 Oct-17 Nov-17 Dec Feb-18 Mar-18 Apr-18 May-18 Jun Aug-18 Sep Mar-17 May Sep-17 Nov Mar-18 May Sep-18 Economic and Monetary conditions, September.4 Monetary and financial conditions Total corporate financing increased at the same pace as the previous month. New credit extended to both businesses and households expanded from the previous month. As at end of month, both the Thai baht against the U.S. dollar and the NEER appreciated from the previous month. Commercial Bank Interest Rates* % p.a. H1/17 H2/17 Q1/18 Q2/18 Q3/18 22 Oct 18 -month deposit rate Average of 5 largest banks Average of other banks MLR Average of 5 largest banks Average of other banks MRR Average of 5 largest banks Average of other banks End of Period Bangkok Bank, Krung Thai Bank, Kasikorn Bank, Siam Commercial Bank and Bank of Ayudhya Source: Bank of Thailand Sources: Bank of Thailand and ThaiBMA Government Bond Yields As of 22 Oct 18 % p.a. 1D BRP 1M 2Y 5Y 10Y Billion baht Change in Total Corporate Financing Business Credits (SA) Equity Debt 3MMA Note: Business credits and debt: change in outstanding Equity: new issuance at par value Sources: Bank of Thailand, ThaiBMA, SET New Private Credit Extended by Other Depository Corporations Billion baht MoM, SA Household % MoM change, SA (RHS) Business Note: Data for other depository corporations (ODCs) private credit and the ODCs private credit extended to households have been revised since uary due to reflect the improvement in the data processing system. Source: Bank of Thailand %

12 30-Dec Feb-17 8-Mar Mar Apr May-17 7-Jun Jun Aug-17 4-Sep Sep Oct-17 9-Nov Nov Dec Feb Feb Mar Apr-18 9-May May Jun Aug Aug Sep-18 9-Oct Dec Feb Mar May Jun Aug Sep Nov Dec-17 7-Feb Mar-18 9-May Jun-18 6-Aug Sep-18 Economic and Monetary conditions, September Exchange Rates Changes in Trading Partners Currencies per USD Index (2012 = ) 118 Appreciation NEER USDTHB (RHS) 22 Oct 8 USDTHB = NEER25 = USDTHB (reverse) % 4.5% 3.5% 2.5% 1.5% 0.5% -0.5% -1.5% -2.5% -3.5% end of Sep 18 compared to end of Aug Oct 18 compared to end of Sep % -2.3% -2.3% 0.5% -1.2% -1.1% -1.8% 0.5% 0.1% -0.1% -0.1% -0.5% -0.7% -0.7% -0.6% -0.8% -0.8% -0.8% 0.3% -0.2% 0.6% 0.6% -2.0% 1.2% -1.3% -1.3% INR JPY IDR PHP CNY MYR EUR VND SGD GBP KRW TWD THB Sources: Reuters, calculated by Bank of Thailand Note: End-period data, + = Appreciation against USD Sources: Reuters, calculated by Bank of Thailand Regional Exchange Rate Volatility % p.a. 12% 10% 8% 6% 4% 2% 0% THB CNY IDR INR KRW MYR PHP As of 22 Oct Sources: Reuters, Bank of Thailand 10

13 Economic and Monetary conditions, September 2.5 Financial stability Headline inflation decelerated due mainly to fresh food prices. Core inflation accelerated from the previous month. The seasonally-adjusted unemployment rate remained unchanged from last month. External stability remained strong and resilient to withstand volatility in the global financial markets. %YoY Contribution to Headline Inflation Fresh Food (15.69%) Energy (11.75%) Core Inflation (72.56%) ( ) Share in Headline Inflation Sep 18 Headline Inflation 1.33% Source: Ministry of Commerce, calculated by Bank of Thailand %YoY Contribution to Core Inflation Rent (19.62%) Food and Beverage ex. Alcohol (28.17%) Other Goods and Services (52.21%) ( ) Share in Core Inflation 2015 Source: Ministry of Commerce, calculated by Bank of Thailand Sep 18 Core Inflation 0.% % Unemployment Rate 2015 Sep 18 Unemployment rate 1.0 % Unemployment rate (sa) 1.0 % Feb Mar Apr May Jun Aug Sep Oct Nov Dec Index sa, 3mma ( 2014=) Employment Index Total Agriculture (31%) Manufacturing (17%) Construction (6%) Trade (17%) Service (29%) Note: Data from 2014 onward are based on The 2010 Population and Housing Census. ( ) denotes share in total employment Source: Labor Force Survey, NSO calculated by BOT External Debt Outstanding Billion USD P P P Change Sep18- Aug18 H1 H2 Q1 Q2 Q3 Aug Sep E Total 1. General government 2. Central Bank* 3. Other Depository Corporations (ODC) 4. Other Sectors - Other Financial Corporations (OFC) - Non Financial Corporations (NFC) O/W Foreign Trade Credit 5. Total Short-term (%) Long-term (%) Note: *including BOT bonds held by non-residents and SDRs allocations by IMF Source : Bank of Thailand P=Preliminary data E=Estimated data Solvency Indicators Current Account / GDP (%) Debt / GDP (%) < / Debt / XGS 1/ (%) < / Debt Service Ratio (%) Liquidity Indicators Gross Reserves / ST Debt > 1 time Gross Reserves / Imports 2/ > 3 times ST Debt / Total Debt (%) External Stability Indicators Note: XGS Export of Goods and Services (3-year average) Monthly Import of Goods and Services (1-year average) Severely indebted countries Source : Bank of Thailand P=Preliminary data E=Estimated data Criteria P P P H1 H2 Q1 Q2 Q3 Aug Sep E 11

14 3. Link to related statistics and contents Agricultural sector Agricultural prices: Agricultural prices Agricultural production: Agricultural products More information: Office Of Agricultural Economics Manufacturing sector Manufacturing production: Manufacturing production index (MPI) Capacity utilization rate: Capacity utilization rate More information: Office of Industrial Economics Real estate sector Property Indicators: Property Indicators (EC_EI_009_S2) More information: Real Estate Information Center Public finance Central government revenue: Government revenue Central government expenditure (GFSM2001): Government expenditure (EC_PF_011) Fiscal Position (GFSM2001): Fiscal position in cash basis (EC_PF_009) More information: Fiscal Policy Office Labor market Labor force survey: Labor force survey (EC_RL_009_S4) Employment: Number of employed persons classified by occupation (EC_RL_012) Average wage: Average wage classified by industry (EC_RL_014_S2) More information: National Statistical Office 12

15 Inflation Inflation: Consumer price index (CPI) More information: Bureau of Trade and Economic Indices Other reports of Monetary Policy Group, Bank of Thailand Monthly report on Business Sentiment Index: Business Sentiment Index Quarterly report on Business Outlook: Business Outlook Report Quarterly report on Credit Condition: Senior Loan Officer Survey 13

16 Contact Agricultural sector Sectoral Analysis Division Manufacturing sector Sectoral Analysis Division Service sector Sectoral Analysis Division Real estate sector Macro Surveillance Team Private consumption Macroeconomics Team Private investment Macroeconomics Team Public finance Public Finance Team The global economy International Economics Division External sector and balance of payments Balance of Payment Division Monetary and financial conditions Monetary Policy Strategy Division Inflation Macro Surveillance Team Labor market Sectoral Analysis Division Financial Stability Macro Surveillance Team Financial Position Macro Surveillance Team External stability Balance of Payment Division