The Thai economy at the 2012 year-end had accelerated with the 4Q12 GDP growing 18.9 percent YoY, the highest quarterly rate since 1993. This growth was also higher than the revised 3.1 percent growth YoY for 3Q12, pushing up 2012 growth to 6.4 percent YoY, which is stronger than previously forecast, showing a marked increase over the poor growth of 0.1 percent in 2011. Meanwhile, the seasonally-adjusted 4Q12 GDP had expanded 3.6 percent QoQ, stronger than 3Q12, which grew at 1.5 percent QoQ, s.a.
Such robust 4Q12 economic performance was not only helped by the low 4Q11 base amid the severe flooding then, but also by momentum gained in household spending at the 2012 yearend, as well as expanded industrial output and higher construction sector activity. Business inventories increased with restocking of gold and certain categories of industrial and farm products.
Regarding the 2013 economic trend for Thailand, KResearch believes that the swift appreciation of the Baht early in the year may prevent a smooth recovery of our export sector. Growth might be lower than hoped due to: 1) Decreased earnings on exports in Baht; and, 2) The impact of the Baht appreciation on our price competitiveness, as well as the decisions of some exporters toward accepting some orders from abroad at disadvantageous prices. We at KResearch have thus revised our export growth projection for 2013 down to 8.0-13.0 percent, assuming that the Baht does not become more vigorous over the rest of 2013. Our projection for 2013 economic growth has therefore been revised downward to 4.3-5.3 percent YoY, versus our previously projected 4.5-5.5 percent growth forecast.
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