Thailand Q2 GDP Annual Growth Beats Estimates


Thailand's gross domestic product grew by 4.6 percent year-on-year in the second quarter of 2018, following an upwardly revised 4.9 percent expansion in the previous period but beating market consensus of 4.5 percent. Government spending rose at a slower pace while investment, private consumption, and exports continued to increase at a solid pace.

On the expenditure side, government spending went up 1.4 percent, compared with 1.9 percent in Q1, as purchases of goods and services went up 10.4 percent, consumption of fixed capital rose 2.6 percent, social transfers in kind and compensation of employees increased 6.2 percent and 0.5 percent, respectively.

Gross fixed capital formation advanced 3.6 percent, faster than 3.4 percent in Q1. Public investment increased 4.9 percent, as a result of state enterprise investment (8.9 percent) and private investment grew 3.2 percent, mainly due to a 3.3 percent expansion of investment on machinery. In addition, spending on private construction expanded 2.8 percent.
 
Also, private consumption rose 4.5 percent, compared to a 3.7 percent expansion in the prior quarter, mainly due to higher farm income along with higher output of main crops such as rice and sugarcane. Durable spending, in particular spending on personal vehicles and furniture boosted high growth. Meanwhile semi-durable goods and service spending maintained favorable growth. However, expenditure on non-durable goods slowed down, namely food and fuels.

Meanwhile, exports of goods and services went up 6.4 percent (vs 6 percent in Q1) while imports of goods and services rose faster 7.5 percent (vs 8.7 percent in Q1).

On the production side, agriculture jumped 10.4 percent, accelerating from a 6.5 percent growth in the March quarter, due to a rise in  agriculture, hunting and forestry (11.6 percent vs 7.2 percent in Q1) while fishing fell (-2.8 percent vs 0.2 percent). Meanwhile, the non-agricultural sector expanded 4.1 percent, easing from 4.8 percent expansion in the previous three-month period. Output grew mainly for: manufacturing (3.1 percent vs 3.8 percentin Q1); wholesale and retail trade (7.2 percent vs 7 percent); transport, storage and communication (7.0 percent vs 7.5 percent); real estate, renting and business activities (3.2 percent vs 4.9 percent); financial intermediation (5.5 percent vs 3.6 percent); hotels and restaurants (9.4 percent vs 12.8 percent in Q1); electricity, gas and water supply (1.8 percent vs 2.1 percent); construction (2.0 percent vs 1.2 percent); health and social work (4.4 percent vs 5 percent); and other community, social and personal services (4.1 percent vs 4.6 percent).
 
Meantime, education showed no growth ( vs 1.7percent in Q1). On the other hand, a contraction was seen in both mining and quarrying (-0.3 percent vs -0.9 percent) and public administration and defence (-0.9 percent vs 0.3 percent);
 
On a quarterly basis, the GDP rose by 1 percent in the three months to June, following an upwardly revised 2.1 percent growth in the previous period and matching market consensus.
 
Considering the first half of the year, the economy expanded by 4.8 percent year-on-year, compared to a 3.7 percent expansion in the same period of 2017.

For 2018, the NESDB still expects the economy to grow between 4.2-4.7 percent.
 
 

Thailand Q2 GDP Annual Growth Beats Estimates


Nesdb, Thailand | Chusnul Ch Manan | chusnul@tradingeconomics.com
8/20/2018 11:58:22 AM