What happened this week 30/06 – 04/07
Thailand
- Bank of Thailand expects growth rebound in 2015 — The Bank of Thailand forecasts economic growth will strengthen to 5.5% next year as the economic recovery gains momentum. (Bangkok Post, 28/06/14)
- BoT sees encouraging trend in currency trading, especially in RMB and pound sterling. CIMBT is showing the same trend in preparation for more ASEAN currency transactions. (Than Setakit, 30/06/14)
- The new ‘Super Board’ is assessing new criteria for state enterprises board membership while SEPO looks to investigate any opaque projects that exceed Bt1bn. (Prachachart Thurakit, 30/06/14)
- NCPO members leaving state enterprises boards as they make way for reform. Gen. Prayut has stepped down from TMB, and Gen. Udomdech has quit IRPC. (Tharn Setakit, 30/06/14)
- PDMO okays loan of Bt250bn in 2014 with additional bond issue plan for Bt126bn as NCPO looks to step up spending in the second half of the year. (Thai Post, 30/06/14)
- Scrap “98% Jasmine Rice” tag, please! — Rice exporters are urging the Ministry of Commerce to scrap the tag 98% Jasmine rice tag, as they feel that it confuses consumers and could damage prices. (Thai Post, 30/06/14)
- Fishing Industry to get hauled in as Army orders trafficking crackdown – Stung by Thailand being downgraded in a major human trafficking report, the military has pledged to make the issue a high priority and will bring in stringent and comprehensive measures to end the problem. (Bangkok Post, 29/06/14)
- NCPO OKs loan scheme for farmers – The military regime has endorsed a Bt4.8bn financial package funded by the FY2015 budget to help farmers reduce production costs during the 2014-15 crop season. In other news, the NCPO yesterday approved extending the current 7% value added tax (VAT) rate for another year when it expires at the end of September. The junta also approved extending the current personal and corporate income tax rates, which were set to expire at the end of 2014, for one more year. (Bangkok Post, 03/07/14)
- The Board of Investment (BoI) continued to move forward in approving the pending projects. Nine more projects, mostly power plants and wind projects, worth Bt28bn will be presented to the board. (Kom Chad Luek, 03/07/14)
- Household debt still going up — The BoT said 1Q14 brought a 10% increase in household debt to exceed Bt9.8trn. Credit card, leasing and personal loans continue to rise, with pawnbroker visits down by 20%. (Kom Chad Luek, 02/07/14)
- Tax reform — Baker Mckinzie said that it has held talks with several businesses in the private sectors regarding tax reform. When it reaches a definite conclusion, it will submit its report to the NCPO and the Ministry of Finance. (Post Today, 02/07/14)
- Three private institutions say MoC export target is too optimistic at 3.5%, they believe 1% is more realistic. The group has some concern regarding economies in the developed world, especially the US, and risks from El Nino. (Than Setakit, 02/07/14)
- Labour reforms are hitting a snag as labour shortage continues. One Stop registration of Myanmar labourers hint at a clear shortage in supply, while rice exports are willing to pay a Bt400 per day to keep their day labourers. (Parchachart Thurakit, 02/07/14)
- Consumers resume spending – Consumer sentiment improved further in June, hitting a six-month high at 75.1 amid improved confidence in the country’s economic and political prospects after the military took control and promised to revitalise the fragile economy. (Bangkok Post, 04/07/14)
- Customs Department mulls raising duty-free restriction – The Customs Department’s working committee will ask newly appointed director-general Somchai Sujjapongse to raise the duty-free limit on new personal items bought abroad from Bt10,000 at present, said a source at the department. (Bangkok Post, 04/07/14)
- NCPO will submit the temporary constitution by September. The former senate deputy speaker said the core problem in Thailand is crooked politicians and diverging views on populist policies and he expects the new constitution to address that. (Krungtep Thurakit, 04/07/14)
Globally
- US: Private-sector employment increased by 281,000 from May to June on a seasonally adjusted basis, marking the strongest monthly gain since November 2012, said private payroll processor ADP Wednesday. The fresh figure was well above market consensus of 213,000. “The June jobs number is a welcome boost. The number of construction jobs added was particularly encouraging, representing the highest total in that industry since February of 2006,” said Carlos Rodriguez, president and chief executive officer of ADP. (Xinhua, 03/07/14)
- US: The Institute for Supply Management said Tuesday that economic activity in the U.S. manufacturing sector expanded in June for the 13th consecutive month, with the purchasing managers’ index (PMI) at 55.3%, just 0.1 percentage point lower than the five-month high of 55.4% in May. Financial data firm Markit said the U.S. manufacturing sector expanded in June, with its final U.S. manufacturing PMI rising to 57.3, the highest since May 2010. (Xinhua, 02/07/14)
- Euro zone unemployment rate remains stable at 11.6% in May: Eurostat – The euro zone seasonally-adjusted unemployment rate was 11.6% in May 2014, stable compared with April, but lower than the 12.0% in May 2013, according to figures published by Eurostat, the statistical office of the European Union (EU) on Tuesday. (Xinhua, 01/07/14)
- German PMI Manufacturing decreased to 52 points in June, from 52.4 points in May, according to data released today by Markit. The result is against market consensus of remaining unchanged (FX Streets, 01/07/14)
- Markit’s final Manufacturing PMI for the euro zone fell to 51.8 in June from May’s 52.2, the lowest reading since November. (Reuters, 01/07/14)
- China PMI: China’s official data released Tuesday showed growth in the country’s manufacturing sector accelerated to a six- month high in June, with the PMI rising to 51 last month, registering a strong end to the second quarter and an encouraging sign that the world’s second largest economy is further stabilizing. (Xinhua, 02/07/14)
- HSBC released the final reading for its manufacturing PMI for China, which came in at 50.7, slightly down from the flash reading of 50.8 but considerably up from May’s final of 49.4. (Xinhua, 01/07/14)
- Japan final June manufacturing PMI 51.5 vs. flash 51.1 — Japanese manufacturing activity expanded in June at a faster pace than initially reported, revised data showed on Tuesday, in a sign that domestic demand has quickly recovered from a sales tax increase at the start of April. (Reuters, 01/07/14)
- US: U.S. nonfarm payroll employment increased by 288,000 in June, said the Labor Department Thursday. The fresh data was much higher than economists’ expectations. While unemployment rate declined unexpectedly from 6.3% to 6.1% in June. (Xinhua, 03/07/14)
- U.S. weekly jobless claims edge up slightly – In the week ending June 28, the advance figure of seasonally adjusted initial claims for jobless benefits rose by 2,000 to 315,000, largely in line with economists’ expectation of 314,000, the data released by the department showed. (Xinhua, 03/07/14)
- ECB leaves key interest rate at record-low 0.15% – The European Central Bank left its key interest rate at a record-low 0.15% at its policy meeting Thursday to continue supporting economic recovery in the eurozone. The decision came after the ECB slashed the benchmark interest rate by 0.10 percentage point to 0.15% from 0.25% in the previous policy meeting in June. (Kyodo, 03/07/14)
- ADB downgrades 2014 GDP growth forecast for Pacific region to 5.2% – The Asian Development Bank (ADB) on Thursday downgraded its 2014 gross domestic product (GDP) growth forecast for the Pacific region to 5.2% due to the impact of flooding in Solomon Islands and weak private sector activity in Timor-Leste. (Xinhua,03/07/14)
- Japan Markit Services PMI fell from previous 49.3 to 49 in June. (FXstreet, 03/07/14)