Monthly economic update: Apr 2024
Executive summary
Global Economy
- In March 2024, global economic growth is stabilized with disinflation momentum being observed in most. Central banks in major economies is expected to ease the financial conditions. Market participants have put more weights on interest rate cuts from major central banks over this year.
- US economic activity had been expanding at a modest pace with supports from labor market resilience albeit inflationary pressure persisted.
- China’s economic recovery was faster-than-expected amid deflationary risks and investors’ concern upon the policy action from the authorities.
Domestic Economy
- In February 2024, overall Thai economy expanded at a slow pace, which was attributed to steadily improve in private consumption, while private investment and manufacturing production improved slightly in some sectors. The number of foreign tourist arrivals increased considerably from the previous month in East Asia thanks to long public holidays and high season effects.
- The growth of merchandise exports in February stayed robust which was the seventh-consecutive month expansion, mainly from the low-base effect and trade rebound. On the other hand, imports value also expanded.
- Headline inflation in March 2024 was contracted in sixth-consecutive month, which was due mainly to energy prices including electricity and retail oil price, on the back of government measures, and fresh food prices also dropped while core inflation dropped further in this month.
Financial Market
- Major central banks end their hiking cycle, except Bank of Japan with the end of monetary policy easing. Market participants and futures market have pointed out possibilities that the Fed would start cutting interest rates in September 2024 since US economic momentum remained robust.
- USDTHB largely depreciated in March 2024, ending 36.45 level. It could be around 36.50-37.00 in April 2024, as market participants reassess the probabilities for Fed’s interest cut to be in 2H2024.
