29 April 2015
Monthly Economic Report (March 2015 and Q1/2015)
"Economic indicators in March and the first quarter of 2015 showed improving signs from domestic expenditures particularly from private consumptions. However, exports showed a contraction. The supply-side economy was supported by the tourism sector even though agricultural sector showed contracting signs. Meanwhile, Thailand's economic stabilities remained robust."Mr. Krisada Chinavicharana, Director-General of the Fiscal Policy Office, Spokesperson of the Ministry of Finance revealed that "Economic indicators in March and the first quarter of 2015 showed improving signs from domestic expenditures particularly from private consumptions. However, exports showed a contraction. The supply-side economy was supported by the tourism sector even though agricultural sector showed contracting signs. Meanwhile, Thailand's economic stabilities remained robust"
Private consumption in March and the first quarter of 2015 showed improving signs as reflected by the real VAT collection at constant price from domestic consumption base in March 2015 , which continued to increase by 20.1 percent per year. As a consequence, overall real VAT collection at constant price expanded by 7.3 percent per year and after seasonal adjustment it expanded by 5.9 percent per month. Thus, in the first quarter of 2015 real VAT collection at constant price expanded by 1.0 percent per year and after seasonal adjustment it expanded by 0.6 percent per quarter. This was corresponding with motorcycle sales , which showed the third consecutive month of expansion by increasing 18.1 percent per year or increasing by 8.4 percent per month after seasonal adjustment. As a result, in the first quarter of 2015 the motorcycle sales expanded by 10.9 percent per year or increased by 9.7 percent per quarter. Meanwhile, passenger car sales in March 2015 continued to contract by -13.4 percent per year. Therefore, in the first quarter of 2015 the passenger car sales contracted by -12.5 percent per year. Consumer Confidence Index in March 2015 continued to decrease to 67.1 points and this was the third consecutive month of contraction. This contraction was caused by the perception in the volatility of global economy and the slow recovery of domestic economy. However, the imports of consumer goods in March 2015 expanded by 5.2 percent per year. As a result, in Q1/2015 the imports of consumer goods increased by 10.0 percent per year or expanded by 10.8 percent per quarter after seasonal adjustment.
Private investment in March 2015 and Q1/2015 showed remaining signs. The investment in construction sector as reflected by cement sales in March 2015 turned to increase by 0.6 percent per year or increased by 2.3 percent per month after seasonal adjustment. However, in Q1/2015 cement sales showed a contraction of -2.5 percent per year. The real estate tax collection in March 2015 increased by 0.7 percent per year. Consequently, in Q1/2015 the real estate tax collection expanded by 4.5 percent per year but decreased by -6.7 percent per quarter after seasonal adjustment. Meanwhile, investment in machinery sector as reflected by commercial car sales contracted by -11.3 percent per year or decreased by -7.0 percent per quarter. The imports of capital goods in March 2015 contracted by -6.9 percent per year and for Q1/2015 the imports of capital goods expanded by 0.9 percent per year or decreased by -0.4 percent per quarter.
Fiscal indicators in March and the 1 st quarter of 2015 (or the 2 nd quarter of Fiscal Year 2015) showed that the fiscal policy played a role in supporting Thai economy through a budget deficit. The budget balance in March 2015 showed a deficit of -81.0 billion baht and in Q1/2015 or equivalent to Q2/FY2015 it showed a deficit of -144.7 billion baht.The net government revenue collection (net of local authorities' allocation) in March 2015 amounted at 157.4 billion baht or increased by 19.2 percent per year. Consequently, that of Q1/2015 (or Q2/FY2015) amounted at 466.5 billion baht or increased by 6.7 percent per year. Meanwhile, the total budget disbursement in March 2015 was recorded at 251.4 billion baht or increased by 52.0 percent per year. Therefore, in Q1/2015 (or Q2/FY2015) the total budget disbursement was recorded at 617.6 billion baht or increased by 11.7 percent per year.
External demand reflected by exports in March 2015 and Q1/2015 continued to decrease. In March 2015 the exports contracted by -4.5 percent per year and this was the third consecutive month of contraction.This contraction was caused by the declining exports in fuel, electronics goods, and electrical appliances. The export markets showing a contraction in March 2015 were China, Japan, Eurozone, and Hong Kong. Therefore, in Q1/2015 the exports in terms of U.S. Dollar contracted by -4.7 percent per year or contracted by -6.2 percent per quarter.
Ms. Kulaya Tantitemit, Executive Director of Macroeconomic Policy Bureau, further elaborated that supply-side indicators in tourism sector showed high-level expansion and this significantly supported the expansion in Thai economy. The preliminary data of March 2015 showed that the number of inbound tourists was recorded at 2.55 million persons or expanded by 25.5 percent per year. Consequently, in Q1/2015 the number of inbound tourists expanded by 23.5 percent per year or expanded by 4.3 percent per quarter. For the first 18 days of April 2015, the number of inbound tourists amounted 1.43 million persons or continually expanded by 21.6 percent per year. This reflected the strong growth in tourism sector. However, Agricultural Production Index (API) in March 2015 continued to contract by -12.3 percent per year due to the contraction in production of rice, rubber, oil palm, and corn for animal feed. The API in Q1/2015 contracted by -5.8 percent per year but expanded by 1.2 percent per quarter after seasonal adjustment. Meanwhile, Thai Industries Sentiment Index (TISI) in March 2015 showed the third consecutive month of contraction by declining to 87.7 points and this was the lowest levels in five months. This was due to the concern of slowing domestic and foreign economies, and the weak domestic purchases order particularly the weak purchasing power from agriculture following the continued decline in agricultural prices.
Internal economic stability remained robust. The unemployment rate in March 2015 was low at 1.0 percent of total labor force or equivalent to 378,000 unemployed persons . Therefore, in Q1/2015 the unemployment rate was recorded at 0.9 percent of total labor force. Meanwhile, headline inflation declined by -0.6 percent per year due to the decrease in world crude oil price . Thus, in Q1/2015 the headline inflation stood at -0.5 percent per year. Meanwhile, the core inflation in March and the first quarter of 2015 was 1.3 and 1.5 percent per year, respectively.External economic stability remained robust , as indicated by high-level of international reserves at 156.3 billion USD, or approximately 2.9 times of short-term external debt. These reflected the resilient ability to risk from the volatilities in global economy.
Source: Fiscal Policy Office / www.fpo.go.th