Monday November 19 2018
Thailand Q3 GDP Annual Growth Weakest in 7 Quarters
Nesdb, Thailand l Chusnul Ch Manan | chusnul@tradingeconomics.com

Thailand's gross domestic product grew by 3.3 percent year-on-year in the third quarter of 2018, following a 4.6 percent expansion in the previous period and far below market consensus of 4.2 percent. It was the weakest growth rate since the fourth quarter 2016, as net external demand contributed negatively to growth while government spending, investment, and private consumption continued to rise at a solid pace.

On the expenditure side, government spending went up 2.1 percent, compared with 2 percent in Q2, as purchases of goods and services increased 4.5 percent, consumption of fixed capital and social transfers of kind rose 2.3 percent and 14.5 percent, respectively while compensations of employees fell 0.4 percent.

Gross fixed capital formation advanced 3.9 percent, faster than 3.7 percent in Q2. Public investment rose 4.2 percent, as a result of state enterprise investment (9.9 percent) and private investment grew 3.9 percent, mainly due to a 3.4 percent expansion of investment on machinery. In addition, spending on private construction expanded 5.4 percent.
 
Also, private consumption increased 5 percent, compared to a 4.5 percent expansion in the prior quarter, mainly due to higher farm income. Durable spending, in particular spending on personal vehicles as well as semi-durable goods. Meantime, non-durable goods spending slowed down namely alcoholic beverages, tobacco and consumption on electricity by household.

Meanwhile, net external contributed negatively to GDP growth, as exports of goods and services edged down 0.1 percent (vs 6.8 percent in Q2) while imports of goods and services went up 10.7 percent (vs 8.3 percent in Q2).

On the production side, agriculture increased.4.3 percent, slowing from a 10.2 percent growth in the June quarter, due to a rise in agriculture, hunting and forestry (5 percent vs 11.4 percent in Q2) while fishing continued to drop (-3 percent vs -2.8 percent). Meanwhile, the non-agricultural sector expanded 3.3 percent, easing from 4.1 percent expansion in the previous three-month period. Output grew mainly for: manufacturing (1.6. percent vs 3.2 percent in Q2); wholesale and retail trade (7.2 percent vs 7.3 percent); transport, storage and communication (6.2 percent vs 6.8 percent); real estate, renting and business activities (4.8 percent vs 3.5 percent); financial intermediation (3 percent vs 4.6 percent); hotels and restaurants (6.5 percent vs 9.4 percent in Q2); electricity, gas and water supply (1.5 percent vs 1.8 percent); construction (4.7 percent vs 2.0 percent); health and social work (1.6 percent vs 4.3 percent); and other community, social and personal services (7.5 percent vs 4.3 percent).
 
On the other hand, a contraction was seen in mining and quarrying (-2.7 percent vs 0.9 percent); public administration and defence (-1.0 percent vs -0.9 percent), and education (-1 percent after showing no growth in Q2).
 
On a quarterly basis, the GDP stalled in the three months to September, following a downwardly revised 0.9 percent growth in the previous period and missing market consensus of a 0.6 percent expansion, It was the weakest quarterly reading since a contraction in the first quarter 2014.
 
Considering the first three quarters of the year, the economy expanded by 4.3 percent year-on-year, compared to a 4.0 percent expansion in the same period of 2017

For 2018, the NESDB revises its economic growth forecast to 4.2 percent from 4.2-4.7 percent, with exports seen up 7.2 percent, 4.7 percent of private consumption and 3.6 percent of total investment.  
 






Monday November 19 2018
Thailand Quarterly GDP Stagnates in Q3
NESDB l Rida | rida@tradingeconomics.com

Thailand's economy unexpectedly showed no growth on quarter in the three months to September 2018, missing market consensus of a 0.6 percent expansion and after a downwardly revised 0.9 percent growth in the previous quarter. It was the weakest quarterly reading since a contraction in the March quarter 2014, due to a marked slowdown in private consumption and a further drop in government spending while net exports contributed negatively to the GDP.

On the expenditure side, private consumption increased at a softer 1 percent, compared to a 1.8 percent advance in the second quarter. At the same time, gross fixed capital formation rose by 0.8 percent, following a 0.7 percent fall in the June quarter. Meanwhile, government spending shrank 0.6 percent, after a 0.5 percent drop in the June quarter and marking the third straight quarter of decline. Also, net external demand contributed negatively, as exports of goods and services declined 4 percent, after a 2 percent in rise the preceding quarter, while imports rose by 3.2 percent (vs 1.7 percent .

On the production side, the agriculture sector contracted 8 percent, following a 9.6 percent increase in the prior three month-period. Also, financial intermediation shrank 1 percent, compared to a 3 percent growth in the prior quarter. On the other hand, output growth accelerated for: manufacturing (0.6 percent vs 0.2 percent in Q2); and wholesale and retail trade; repair of motor (1.9 percent vs 1.6 percent).

Year-on-year, the economy grew an annual 3.3 percent in the September quarter, also missing estimates of  a 4.2 percent expansion and after a 4.6 percent growth in the June quarter. It marked the slowest pace of expansion since the December quarter 2016.  

For 2018, Southeast Asia's second biggest economy is expected to advance 4.2 percent, compared to an earlier projection of 4.2 to 4.7 percent. Exports for the year is estimated to increase by 7.2 percent, lower than a previous forecasts of 10 percent.




Wednesday November 14 2018
Thailand Leaves Monetary Policy Unchanged
Bank of Thailand l Rida | rida@tradingeconomics.com

The Bank of Thailand voted by four to three to keep the policy rate at 1.5 percent on 14th November 2018, as widely expected. The Committee said that monetary policy should remain accommodative, although the need for accommodative policy would be gradually reduced, despite signs of sluggishness in the economy's two main drivers, exports and tourism.

Statement by the Bank of Thailand:

The Thai economy as a whole continued to gain traction despite some signs of slowing export growth owing in part to trade protectionism measures between the US and China, a slowdown of the electronics cycles, and trading partner countries’ weather conditions which were temporary factors. Meanwhile, tourism exhibited a slower growth especially due to a declined number of Chinese tourists. However, domestic demand momentum continued to expand. Private consumption was expected to expand on the back of improvements in income and employment in non-agricultural sector but was restrained by elevated household debt.

Private investment was projected to continue expanding owing to the relocation of production base to Thailand and public-private partnership projects for infrastructure investment. Public expenditure would grow at a slower pace than previously assessed due to delayed investment by some state-owned enterprises. Overall, the Thai economy would continue to expand but would be subject to increasing downside risks from trade protectionism measures between the US and China, which could have larger impacts than expected, and from geopolitical risks.

The annual average of headline inflation was expected to rise slowly in line with the previous assessment. However, downside risks increased due to fluctuations in energy and fresh food prices. Core inflation was projected to rise broadly in line with the previous assessment  given the gradually rising demand-pull inflationary pressures. The Committee viewed that structural changes contributed to more persistent inflation than in the past. Such changes included the expansion of e-commerce, rising price competition, and technological development which reduced costs of production.

Overall financial conditions remained accommodative and conducive to economic growth with ample liquidity in the financial system. Short-term government bond yields increased slightly. Real interest rates remained low, allowing financing by the private sector to continue expanding as reflected in both business and consumer loan growth. With regard to exchange rates, the baht depreciated against the US dollar, in the same direction with regional currencies, due to concerns over growing risks to the global economy. Looking ahead, the baht would likely remain volatile and thus the Committee would continue to closely monitor exchange rate developments as well as impacts on the economy.

Financial stability remained sound overall but there remained a need to monitor risks that might pose vulnerabilities to financial stability in the future, especially the search-for-yield behavior in the prolonged low interest rate environment that might lead to underpricing of risks. The competition in the mortgage loan market, which led to looser credit standards, was addressed to a certain extent by the revision in macroprudential measure on mortgage loans. In addition, the Committee deemed it necessary to monitor further household debt accumulation and debt serviceability of SMEs especially those affected by changes in structural factors and business models.

Looking ahead, the Thai economy as a whole was projected to continue to gain traction despite moderating external demand and potential risks from larger-than-expected impacts of trade protectionism measures between the US and China. Furthermore, there remained a need to monitor developments of inflation and financial stability risks going forward.





Wednesday September 19 2018
Thailand Holds Policy Rate at 1.5%
Bank of Thailand | Agna Gabriel | agna.gabriel@tradingeconomics.com

The Bank of Thailand voted by five to two to maintain the policy rate at 1.5 percent on September 19th 2018, as widely expected. The Committee said that the current monetary policy stance continued to support economic growth and should support the increase of inflation rate toward its target. Annual inflation rate increased to 1.6 percent in August from 1.5 percent in July. Still, two members voted to raise the policy rate by 25bps to 1.75 percent.

Statement by the Bank of Thailand:

The Thai economy as a whole continued to gain traction, driven by merchandise exports and tourism which continued to improve in tandem with global economic growth, and by continued momentum from domestic demand. Growth in merchandise exports was expected to slow down somewhat due to trade protectionism measures between the US and China but would be partially offset by benefits from the relocation of production base to Thailand for some industries. Private consumption was expected to continue to achieve higher growth supported by improvements in income and employment, but overall purchasing power was recovering gradually due to elevated household debt. Public expenditure would grow at a lower rate than previously assessed due to constrained budget disbursement. Furthermore, the Thai economy would be subject to downside risks and uncertainties regarding US foreign trade policies that could be additionally announced, retaliatory measures from trading partners of the US, as well as geopolitical risks. 

The annual average of headline inflation was expected to rise slowly in line with the previous assessment. However, downside risks remained as fresh food prices could fluctuate sharply depending on weather conditions and agricultural output. Core inflation was projected to edge up at a somewhat lower rate than previously assessed given the gradual build-up of demandpull inflationary pressures. The Committee viewed that, despite full potential economic growth, structural changes might contribute to more persistent inflation than in the past. Such changes included the expansion of e-commerce, rising price competition, and upgrades to production efficiency which reduced costs of production. Meanwhile, the public’s inflation expectations were largely unchanged. 

Overall financial conditions remained accommodative and conducive to economic growth with ample liquidity in the financial system. Overall government bond yields increased slightly, while real interest rates remained low. Such conditions allowed financing by the private sector to continue expanding as reflected in higher growth in both business and consumer loans. With regard to exchange rates, the baht appreciated against regional currencies since the last meeting due to concerns over external stability in emerging market economies. Looking ahead, the baht would likely remain volatile and thus the Committee would continue to closely monitor exchange rate developments as well as impacts on the economy. 

Financial stability remained sound but there was still a need to monitor risks that might pose vulnerabilities to financial stability in the future, especially the search-for-yield behavior in the prolonged low interest rate environment that might lead to underpricing of risks. The Committee was concerned aboutcompetition in the housing loan market which led to loosercredit standards. In addition, the Committee deemed it necessary to monitor the oversupply of condominiums in certain areas, further accumulation of household debt given that deleveraging had yet to improve, and debt serviceability of SMEs especially those affected by changes in structural factors and business models. 

Looking ahead, the Thai economy as a whole was projected to continue to gain traction driven by both external and domestic factors. However, there remained the need to monitor inflation developments and financial stability risks in the period ahead, as well as risks arising from impacts of trade protectionism measures of the US and retaliatory measures by major advanced economies. Hence, the Committee viewed that monetary policy should remain accommodative, although the need for currently accommodative monetary policy would be gradually reduced.


Monday August 20 2018
Thailand Q2 GDP Annual Growth Beats Estimates
Nesdb, Thailand | Chusnul Ch Manan | chusnul@tradingeconomics.com

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.
 
 


Monday August 20 2018
Thailand Economy Grows 1% QoQ in Q2
NESDB | Rida | rida@tradingeconomics.com

Thailand's economy advanced 1 percent quarter-on-quarter in the June quarter of 2018, following an upwardly revised 2.1 percent growth in the previous period and matching market consensus. Growth was mainly driven by private consumption and net exports while government spending and fixed investment contracted.

On the expenditure side, government spending shrank for the second straight quarter (-1.1 percent from -0.6 percent in the March quarter). In addition, gross fixed capital formation contracted for the first time since the third quarter 2017 (-0.8 percent from 2.7 percent). On the other hand, private consumption increased by 1.8 percent, faster than a 1.4 percent rise in the first quarter. At the same time, net external demand contributed positively to growth, as exports of goods and services went up 1.9 percent (from 1.1 percent in the preceding quarter), while imports rose by 0.9 percent, much slower than a 2.6 percent growth in the March quarter.

On the production side, the agriculture sector expanded 10.3 percent, slower than a 11.5 percent increase in the prior three month-period. Meanwhile, manufacturing sector showed no growth, after a 0.4 percent rise in the prior quarter. At the same time, wholesale and retail trade; repair of motor grew by 1.5 percent, the same as in Q1. Financial intermediation jumped by 3.8 percent, compared to a 0.3 percent growth in the prior quarter.
Year-on-year, the country's GDP expanded 4.6 percent from a year earlier, slightly above estimates of a 4.5 percent expansion and after an upwardly revised 4.9 percent growth in the March quarter.

For 2018, the economy is expected to grow between 4.2 to 4.7 percent, unchanged from an earlier estimate, supported by robust exports and growing tourism.


Wednesday August 08 2018
Thailand Leaves Monetary Policy Unchanged
Bank of Thailand | Agna Gabriel | agna.gabriel@tradingeconomics.com

The Bank of Thailand voted by six to one to maintain the policy rate at 1.5 percent on August 8th, saying that the current monetary policy stance continued to support growth while inflation remained within the 1-4 percent target. Still, one member voted to raise the key rate by 0.25 percentage point to 1.75 percent.

Statement by the Bank of Thailand:

The Thai economy as a whole continued to gain further traction, driven by merchandise exports and tourism which continued to improve in tandem with global economic growth, and by stronger momentum from domestic demand. Private consumption continued to expand supported by improvements in employment, but overall purchasing power was recovering gradually due to elevated household debt. Private investment was projected to continue expanding with additional support from greater certainty regarding the prospects of public investment projects, although their progress must still be monitored going forward. Public expenditure would continue to drive economic growth but there remained risks of delayed budget disbursement. Furthermore, Thailand’s growth outlook was still subject to risks that continued to warrant close monitoring, especially US foreign trade policies and retaliatory measures from trading partners of the US, risks of lower-than-expected growth in the tourism sector, and geopolitical risks.

The outlook for headline inflation was largely unchanged from the previous assessment with the annual average expected to be within target. However, downside risks remained as fresh food prices could fluctuate sharply depending on weather conditions and agricultural output. Core inflation was projected to edge up given the gradual build-up in demand-pull inflationary pressures. The Committee would also continue to monitor, despite full potential economic growth, structural changes that might contribute to more persistent inflation than in the past such as the expansion of e-commerce, rising price competition, and upgrades to production efficiency which reduced costs of production. Meanwhile, the public’s inflation expectations were largely unchanged.

Overall financial conditions remained accommodative and conducive to economic growth with ample liquidity in the financial system. Government bond yields were largely unchanged from the previous meeting, while real interest rates remained low. Such conditions allowed financing by the private sector to continue expanding as reflected in both business and consumer loan growth. The baht against the US dollar exchange rate experienced volatile movements due to the monetary policy outlook of advanced economies, as well as increased concerns about trade protectionism measures and risks related to emerging market economies. Such exchange rate movements were in line with those of most regional currencies. Looking ahead, the baht would likely remain volatile and thus the Committee would continue to closely monitor exchange rate developments as well as impacts on the economy.

Financial stability remained sound but there was still a need to monitor risks that might pose vulnerabilities to financial stability in the future, especially the search-for-yield behaviour in the prolonged low interest rate environment that might lead to underpricing of risks. In addition, the Committee would also closely monitor competition in the housing loan market, the oversupply of condominiums in certain areas, further accumulation of household debt given that deleveraging had yet to improve, and debt serviceability of SMEs especially those affected by changes in structural factors and business models.

Looking ahead, the Thai economy as a whole was projected to continue to gain further traction driven by both external and domestic factors. However, there remained the need to monitor the strength of the domestic demand, inflation developments, financial stability risks in the period ahead, as well as impacts of trade protectionism measures and risks of lower-than expected growth in the tourism sector. Hence, the Committee viewed that monetary policy should remain accommodative.



Wednesday June 20 2018
Thailand Holds Interest Rate Steady at 1.5%
Bank of Thailand | Stefanie Moya | stefanie.moya@tradingeconomics.com

The Bank of Thailand voted unanimously to left its one-day repurchase rate unchanged at 1.5 percent on June 20th meeting, as widely expected. The Committee said that the current monetary policy stance continued to support economic growth and should support the increase of inflation rate toward its target. Annual inflation rate advanced to 1.5 percent in May from 1.1 percent in April and it is expected to rise at a slightly faster pace boosted by higher oil prices.

Statement by the Bank of Thailand:

The Thai economy as a whole continued to gain further traction, driven by merchandise exports and tourism which continued to improve in tandem with global economic growth, and by stronger momentum from domestic demand. In particular, private consumption continued to expand, although elevated household debt and the economic expansion had yet to benefit household income and employment in a broad-based manner, resulting in a gradual improvement in purchasing power. In the Committee’s view, these issues must be addressed through structural policies. Private investment was projected to continue expanding with additional support from public investment projects whose prospects became more certain, although their progress in the period ahead must be monitored. Meanwhile, public expenditure would be a driver of growth but there remained risks of delays in budget disbursement. Furthermore, Thailand’s growth outlook was still subject to external risks that continued to warrant monitoring, especially US foreign trade policies and retaliatory measures from trading partners of the US, and geopolitical risks.

Headline inflation was projected to rise at a slightly faster pace than previously assessed toward target on the back of increases in oil prices. Core inflation was projected to edge up given gradual build-up in demand-pull inflationary pressures. Moreover, structural changes, such as an expansion of e-commerce and rising price competition, still warranted monitoring as they might contribute to more persistent inflation than in the past. Meanwhile, the public’s inflation expectations were largely unchanged. 

Overall financial conditions remained accommodative and conducive to economic growth with ample liquidity in the financial system. Overall government bond yields increased somewhat compared with the previous meeting, while real interest rates remained low. Such conditions allowed financing by the private sector to continue expanding with improvements seen in the amount of credit extended to SMEs and consumer loans. On exchange rates, the baht depreciated against the US dollar and experienced volatile movements due to the monetary policy outlook of advanced economies and increased concerns about trade protectionism measures as well as risks related to emerging market economies. Looking ahead, the baht would likely remain volatile. Thus, the Committee would closely monitor exchange rate developments as well as impacts on the economy going forward. 

Financial stability remained sound but there continued to be a need to monitor pockets of risks that might pose vulnerabilities to financial stability in the future. These included, in particular, the search-for-yield behavior in the prolonged low interest rate environment that might lead to underpricing of risks, and the deterioration in debt serviceability of households and SMEs, especially those affected by changes in structural factors and business models. 

Looking ahead, the Thai economy as a whole was projected to continue to gain further traction driven by both external and domestic factors. However, there remained the need to monitor the strength of the domestic demand and inflation developments in the period ahead, as well as impacts of trade protectionism measures which remained highly uncertain. Hence, the Committee viewed that monetary policy should remain accommodative.


Monday May 21 2018
Thailand Q1 GDP Growth Strongest in 5 Years
Nesdb, Thailand | Chusnul Ch Manan | chusnul@tradingeconomics.com

Thailand's gross domestic product grew by 4.8 percent year-on-year in the first quarter of 2018, following a 4 percent expansion in the previous period and beating market consensus of 4 percent. It was the strongest growth since the first quarter 2013, as government spending, investment, and private consumption rose at faster paces.

On the expenditure side, government spending went up 1.9 percent, compared with 0.2 percent in Q4, as purchases from enterprises and abroad rose 4.9 percent, fixed capital went up 2.7 percent, and social transfers in kind and compensation of employees increased 1.3 percent and 2.1 percent, respectively. In addition, gross fixed capital formation advanced 3.4 percent, faster than 0.3 percent in Q4. Public investment increased 4 percent, as a result of  state enterprise investment (11.6 percent) and private investment grew 3.1 percent, mainly due to a 3.1 percent expansion of investment on machinery. In addition, spending on private construction expanded 3.4 percent.
 
Also, private consumption rose 3.6 percent, compared to a 3.4 percent expansion in the prior quarter, mainly due to services, non-durable and semi-durable goods, particulary food and non-alcoholic beverages. However, expenditure on durable goods slowed down, namely motor vehicles. Meanwhile, exports of goods and services went up 6 percent (vs 7.4 percent in Q4) while imports of goods and services rose 9 percent (vs 7.5 percent in Q4).
 
On the production side, agriculture jumped 6.5 percent, recovering from a 1.3 percent contraction in the December quarter, due to a rebound in both agriculture, hunting and forestry (7.1 percent vs -1.2 percent in Q4) and fishing (0.2 percent vs -2.4 percent). Meanwhile, the non-agricultural sector expanded 4.7 percent, the same as in the previous three-month period. Output grew mainly for: hotels and restaurants (12.8 percent vs 15.3 percent in Q4); wholesale and retail trade (7 percent vs to 6.9 percent); electricity, gas and water supply (2.2 percent vs 3.1 percent); transport, storage and communication (7.1 percent vs 8.8 percent); real estate, renting and business activities (4.5 percent vs 5.8 percent); financial intermediation (3.5 percent vs 3.6 percent); manufacturing (3.7 percent vs 3.4 percent); public administration and defence; education (1.7 percent vs 1.3 percent); health and social work (5 percent vs 3.8 percent), other community, social and personal services (4.7 percent vs 4.1 percent), and rebounded for construction (1.2 percent vs -5.3 percent). On the other hand, a contraction was seen in mining and quarrying (-0.8 percent vs 0.5 percent).

For 2018, the NESDB raises its economic growth forecast to 4.2-4.7 percent from 3.6-4.6 percent.


Monday May 21 2018
Thailand Economy Expands 2% QoQ in Q1
NESDB l Rida | rida@tradingeconomics.com

Thailand's economy advanced 2 percent quarter-on-quarter in the March quarter of 2018, following a 0.5 percent growth in the previous period and easily beating market consensus of a 1.05 percent expansion. It is the strongest quarterly growth since the fourth quarter 2012, mainly supported by faster rises in private consumption and fixed investment.

On the expenditure side, private consumption increased at a stronger 1.3 percent (from 0.8 percent in the December quarter. Also, gross fixed capital formation expanded by 2.8 percent, faster than a 2.3 percent rise in the prior quarter. On the other hand, goverment spending contracted 0.1 percent, after a 4.7 percent growth in Q4. Meantime, net external demand contributed negatively to growth, as exports of goods and services went up 1 percent (from 1.2 percent in the preceding quarter), while imports rose by 3 percent, the same as in the December quarter.

On the production side, manufacturing sector grew by 0.3 percent, faster than a 0.1 percent rise in the preceding quarter. At the same time, agriculture sector expanded 11.6 percent, rebounding sharply from a 7 percent decline in the prior three month-period. Meanwhile, wholesale and retail trade; repair of motor grew by 1.5 percent (from 2.1 percent). On the other hand, financial intermediation shrank 0.4 percent, following a 1.2 percent rise in the prior quarter.

Year-on-year, the country's GDP grew by 4.8 percent from a year earlier, above estimates of a 4 percent expansion and after a 4 percent growth in the December quarter. It is the strongest pace of expansion since the March quarter 2013.