What happened this week 26/08 – 30/08


FDI falls — The BoI says that FDI for the first half of the year dropped to Bt450-550bn due to the slowdown in the economy and exports. In the first seven months, applications have lowered by 15%; Japanese investors were still the number one investors. (Krungthep Turakij, 26/08/13)

Tax revenue may miss target as VAT collection lags – The Revenue Department is worried that tax collection this year might be lower than the target, as VAT from imports has been Bt10bn less than expected. (The Nation, 26/08/13)

World Bank offers view – Capital will flow to the Thai financial markets if the local economy shows signs of healthier growth in the second half, says Kirida Bhaopichitr, the World Bank’s senior economist for Thailand. (Bangkok Post, 26/08/13)

Exports will not meet 2013 growth target, says ministry – The Commerce Ministry yesterday acknowledged that Thailand would definitely miss its export-growth target of 7-7.5% this year after shipments in the first seven months rose only 0.6% amid global economic struggles. (The Nation, 27/08/13)

NESDB wary of declining productivity of workforce – Productivity in the Thai economy improved by a mere 1.9% in the second quarter, compared to 4% growth the previous quarter. Arkhom Termpittayapaisith, secretary-general of the NESDB, warned that Thailand’s workforce will be uncompetitive when the country opens its doors to the ASEAN Economic Community in late 2015 because of a shortage young workers, with the majority poorly educated. The youth labor participation rate fell from 53.1% in 2001 to 46.8% in 2012, representing 4.82mn workers. (Bangkok Post, 27/08/13)

ADB poised to cut Thailand growth forecast – The Asian Development Bank (ADB) may revise down its 2013 gross domestic product growth forecast for Thailand on the back of slower first-half economic data. The ADB had pegged Thai economic growth at 4.9% based on an assumption of 8% export growth, but this is expected to be pared down to between 4% and 4.3%. The new rate will be announced in October. (Bangkok Post, 28/08/13)

Bank of Thailand eyes sovereign wealth fund – The Bank of Thailand is studying a plan to use its surplus foreign reserves to establish what would be called a New Opportunity Fund, aimed at increasing returns as a part of efforts to improve the central bank’s balance sheet. (Bangkok Post, 28/08/13)

OIE to revise GDP forecast — The Office of Industrial Economics (OIE) says it will revise its GDP forecast in October from its initial 3-4% forecast after GDP for the first seven months stood at 1.9%. It will also be revising its Manufacturing Production Index (MPI) from its initial forecast of 0.5-1% after the index plunged to -1.5% in the first seven months. The OIE believes that there is a high risk that the MPI will end up negative by yearend. (Matichon, 29/08/13)



US house sales fall by 13.4% casts shadow over economic recovery — Government says sales down to annual rate of 394,000 and revises down its estimates for home sales in June. Sales of new single-family homes in America fell sharply in July to their lowest level in nine months, casting a shadow over the country’s housing recovery. Sales dropped 13.4% to an annual rate of 394,000 units, the Commerce Department said on Friday. The government also revised sharply lower its estimate for home sales in June. (The Guardian, 23/08/13)

US: New orders for manufactured durable goods in July dropped 7.3% from the previous month following three consecutive monthly increases, weighed down by a weak demand for transportation equipment, the U.S. Commerce Department reported Monday. The latest durable goods figure marked the biggest drop in nearly a year and fell far short of analysts’ expectations of a 4% decrease. The statistics also indicated weakness in the world’s largest economy and added uncertainties over when the Fed will start to trim its monthly asset purchases.

US: U.S. home prices continued to increase in June but at a slower pace, according to a report released by S& P Dow Jones Indices Tuesday. The S&P/Case-Shiller Home Price Indices, the leading measures of U.S. home prices, posted monthly returns of 2.2% in June both for the 10- and 20-City Composites, the report said, adding that all 20 cities posted gains on a monthly and an annual basis.

U.S. consumer confidence index increased slightly in August, according to the Conference Board, a global, independent business membership and research association. The Index stood at 81.5, up from 81.0 in July. (Xinhua, 28/08/13)

US: U.S. pending home sales fell 1.3% in July following a 0.4% decline in June, with higher mortgage interest rates slowing the market, the National Association of Realtors said Wednesday. Meanwhile, mortgage applications decreased 2.5% from the previous week, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending Aug. 23. (Xinhua, 29/08/13)

US: The real gross domestic product of the United States increased at an annual rate of 2.5% in the second quarter this year, the U.S. Commerce Department announced Thursday. It beat market expectations and is a welcome acceleration from an initial estimate of 1.7% released last month. Meanwhile, the number of Americans who initially applied for jobless benefits decreased 6,000 to 331,000 in the week ending Aug. 24 from an upwardly-revised figure of 337,000 in the prior week, the Labor Department reported Thursday. (Xinhua, 30/08/13)

Europe: Hungary’s central bank cuts benchmark by 20 pts to 3.8% The rate-setting Monetary Council of the National Bank of Hungary cut the benchmark two-week deposit rate by 20 basis points to 3.8% on Tuesday, marking the thirteenth straight monthly reduction. While the 3.8% marks a record low rate, the amount of the cut was slightly less than the earlier decreases of 25 basis points or a quarter of a percent each, since this one was only 20 basis points or a fifth of a percent.(Xinhua, 27/08/13)

Myanmar: Myanmar lawmakers approve telecoms bill – Myanmar’s parliament has passed a telecoms bill paving the way for licensed international firms to operate, state media said on Wednesday, in the latest move to open the potentially lucrative mobile market. The former junta-run nation last month awarded telecom licenses to Norway’s Telenor and Qatari firm Ooredoo as it tries to raise telephone coverage from less than 10% currently to 80% by 2016. (The Nation, 30/08/13)


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