Thai economy expands more than estimated on public investment, tourist arrivals

Shoppers at a mall in Bangkok on Nov 9, 2015.
Shoppers at a mall in Bangkok on Nov 9, 2015. PHOTO: EPA

BANGKOK (BLOOMBERG) - Thailand's economy grew more than analysts estimated in the third quarter as government stimulus spending and a rise in tourist arrivals offset weak local demand and exports.

Gross domestic product gained 2.9 per cent in the three months through September from a year earlier, the National Economic and Social Development Board said on Monday (Nov 16). That compares with the median estimate of 2.5 per cent in a Bloomberg survey of 26 analysts. GDP grew 1 per cent from the previous quarter, compared with a prediction for a 0.6 per cent gain.

Prime Minister Prayuth Chan-Ocha is seeking to accelerate spending on railways, roads and checkpoints to boost border trade with neighbouring countries as overseas demand for Thailand's disc drives and automobiles remains subdued.

The central bank kept its key interest rate unchanged for the fourth straight meeting earlier in November as it waits to assess whether the stimulus will succeed in boosting weak local demand.

"That private sector demand remains poor is no longer a secret," DBS Group Holdings said on Monday in a client note before the GDP release.

"Going by the Bank of Thailand's gauges, private consumption and investment have been flat for the best part of the last three years. Any improvement seen this year has been marginal at best."