Analyst Meeting No. 1/20207 January 2020

2/25

Agenda

• The growth and inflation projections and monetary policy decision• Monetary policy target for the medium-term horizon and

the target for 2020• Special issue: Savings – Investment gap, the reflection of

Thailand’s economic imbalances

3/25

The growth and inflation projections and monetary policy decision

4/25

Outlook of the Thai economy

2018* 2019E 2020E

GDP Growth 4.1 2.5 2.8

(2.8) (3.3)

Headline inflation 1.1 0.7 0.8

(0.8) (1.0)

Core inflation 0.7 0.5 0.7

(0.6) (0.9)* Outturn, E Estimate

( ) Monetary Policy Report September 2019

• The Thai economy is expected to expand below its potential and below the previous forecast, mainly as merchandise exports contracted more than previously assessed and are projected to recover more slowly than expected.

• The Thai economy is expected to gain further traction in 2021 as some PPP projects were postponed to take place.

• Headline inflation in 2019 and 2020 are projected to be below the target due to lower-than-expected energy prices in tandem with subdued global economic growth and increasing energy supply. Headline inflation is expected to return to the target during the second half of 2021.

• Risks to economic growth and inflation projections remain tilted to the downside due mainly to external risks.

5/25

Forecasts in the Monetary Policy Report as of December 2019

(% YoY) 2018*2019E 2020E

Sep 19 Dec 19 Sep 19 Dec 19GDP Growth 4.1 2.8 2.5 3.3 2.8- Private Consumption 4.6 3.8 4.4 3.1 3.0- Private Investment 3.9 3.0 2.5 4.8 3.4- Government Consumption 1.8 2.3 2.2 3.4 2.6- Government Investment 3.3 2.5 1.7 6.3 6.3- Exports of Goods and Services 4.2 -2.3 -4.8 2.3 1.4- Imports of Goods and Services 8.6 -2.6 -4.3 2.9 1.6Current Account (Billion USD) 28.5 34.2 35.2 30.4 30.0- Value of Merchandise Exports 7.5 -1.0 -3.3 1.7 0.5- Value of Merchandise Imports 13.7 -3.6 -5.2 3.5 1.4

Headline Inflation 1.1 0.8 0.7 1.0 0.8Core Inflation 0.7 0.6 0.5 0.9 0.7Assumptions- Number of Tourists (Million) 38.2 39.7 39.9 41.2 41.7- Dubai Oil Price (USD/Barrel) 69.6 64.0 63.4 63.0 62.5

•Merchandise exports contracted more than the previousassessment and are projected to recover more slowly thanexpected. This is due to the slowdown of global tradevolume affected by trade tensions and the impact ofstructural changes in the manufacturing sector on exportcompetitiveness.

• Tourism is expected to continue to grow.• Public expenditure and private investment are expected

to expand more slowly than the previous forecast owingpartly to delays in some state-owned enterprise investmentprojects and some PPP infrastructure investment projects.

• Private consumption is projected to decelerate due tolower household income and employment, particularly inexport-related manufacturing sectors, elevated householddebt, and the drought.

Note: * Outturn, E Estimation

6/25

3.3 3.0 3.3

0.9

3.6 3.43.9

3.3

0.0

2.0

4.0

6.0

WEO Apr 19 WEO Oct 19 WEO Apr 19 WEO Oct 192019F 2020F

Value of merchandise exports contracted in line with those ofother regional countries due to global trade slowdown

• Value of merchandise exports in 2019 is expected to contract more than previously estimated and recover more slowly than expected in line with those of other regional countries due to the slowdown in global trade volume and the impact of structural changes in the manufacturing sector on export competitiveness.

•Merchandise exports are projected to record a moderate growth in 2020 thanks to the recovery of global trade and the electronics cycle.

Asia export performance Global economic growth and trade volume forecasts

Source: BOT, CEIC

Index, SA and 3mma(Jan 2013 = 100)

75

95

115

135

Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 Jan-19

China Indonesia (non-oil & gas)Singapore Thailand (non-gold)Malaysia South KoreaTW Philippines

Source: World Economic Outlook (IMF) April and October 2019

%YoY

IMF revised down its 2019 global trade volume forecast significantly. However, global trade volume is expected to improve in 2020.

Thai merchandise export performance was in line with other regional countries.

Global growth Global trade

7/25

Impact of export contraction on domestic demand, through employment and income, became more pronounced

• Impact of export contraction on the labor market was more evident, as reflected by a rising number of employees whose employers temporarily suspend business operation. • Total and overtime (OT) income of non-farm workers continued to decline. Such decline was seen in more

sectors other than export-related manufacturing sector. Moreover, changing employment pattern from monthly to daily contract has been increasingly observed.

Source : 1. Data on Section 75 from the Department of Labor Protection and Welfare 2. Labor force survey, NSO

A number of employees whose employers temporarily or partly suspend business operation (Section 75)

0

5,000

10,000

15,000

20,000

25,000

30,000

Jan-16 Jan-17 Jan-18 Jan-19

Persons

Oct 19

Total and overtime income (real terms)

200

210

220

230

240

250

260

3

4

5

6

7

8

9

Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19

Billio

nsTotal non-farm income (RHS)

Overtime non-farm income

Billions of baht(SA, 3mma)

Oct 19

Billions of baht(SA, 3mma)

8/25

• Changes in employment pattern to sub-contract and service contract

• Less job security and possibly immediate cancellation of employment contract by employers

• Not receiving the same benefits as regular employees

62

64

66

68

70

72

74

2.54.56.58.5

10.512.514.516.518.520.5

2008

Q1

2008

Q3

2009

Q1

2009

Q3

2010

Q1

2010

Q3

2011

Q1

2011

Q3

2012

Q1

2012

Q3

2013

Q1

2013

Q3

2014

Q1

2014

Q3

2015

Q1

2015

Q3

2016

Q1

2016

Q3

2017

Q1

2017

Q3

2018

Q1

2018

Q3

2019

Q1

2019

Q3

The labor market encounters both economic slowdown and challenges from structural factors

Million persons (SA) %Persons outside the labor force

Labor force participation rate of populations aged 15 and above (RHS)

Trend

Actual

The labor market still faces challenges from structural factors including1. An aging society that reduces the number of workers2. An increasing adoption of automation among businesses

Source: 1. Jaree Pinthong et al. (2018) 2. Nada Wasi et al. (2018) 3. Patcharaporn Leepipatpiboon and Nuntanid Thongsri (2018) 4. Business Intelligence Report by the BOT 5. Labor force survey by the NSO 6. Saovanee Chantapong and Kanchanit Lertpienthum (2018)

3. The rise of digital platform which altered employment patterns

4. Skills mismatch in the Thai labor market and technological advancement

Labor Demand 2013 Labor Supply 2016

41% in STEM21% in STEM

• Reduce work shifts such as from 3 to 2 shifts

• Cancellation of employment contracts • Offering early retirement• Changes in employment pattern

• Harder return to the labor market, especially for old workers and mismatched workers

• Possibly getting lower earnings, in case workers cannot find better jobs and thus move to work in relatively lower-paid sectors

• Possibly getting different benefits and income security due to changing employment patterns

Future challenges in finding jobs

Recent economic slowdownled to the following adjustments

by employers in several industries

9/25

Private consumption, in the short-term, was supported by government stimulus measures, but was expected to grow moderately in the period ahead in line with income

• Additional government stimulus measures toward the end of 2019 helped boost private consumption in the short term. • Going forward, private consumption is expected to slow down in line with income, lower household confidence,

and elevated household debt. Moreover, the drought will be key risk to farm income in 2020.

Consumer Confidence Index (CCI)

40

50

60

70

80

90

100

Jan2014

July Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul

Total Current Next 6 months Average 5 years

Diffusion Index, sa(unchanged = 100)

Source: Center for Business and Economic Forecasting, the University of Chamber of Commerce

Private Consumption Index (PCI)

-5

0

5

10

15

20

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul

Total PCI Non-durables Index Services Index%YoY

Nov 19

Source: Bank of Thailand

10/25

• Short-term government bond yields continued to decline in tandem with the policy rate. New loan rates (NLR) also decreased in all contract sizes.

• Reference loan rates and fixed deposit rates decreased, while saving rates remained unchanged.

An additional policy rate cut in Nov 19 has transmitted to broader types of interest rates

Source: Thai BMA and Bank of Thailand

4.62

3.81

3.05

0

0.5

1

1.5

2

2.5

3

2

3

4

5

6

Jan-

17

Apr-1

7

Jul-1

7

Oct-1

7

Jan-

18

Apr-1

8

Jul-1

8

Oct-1

8

Jan-

19

Apr-1

9

Jul-1

9

Oct-1

9

NLR < 500 Mn baht (50.1%) Total NLR

NLR >= 500 Mn baht (49.9%) RP (RHS)Oct 19

New loan rate (NLR)% %

% Oct 19 Dec 19

MLR 6.28 6.08

MOR 6.86 6.86

MRR 6.94 6.89

Saving 0.46 0.46

3M 0.98 0.88

6M 1.27 1.17

12M 1.45 1.33

Average interest rates

1.00

1.25

1.50

1.75

2.00

2.25

2.50

2.75

Dec-

18

Jan-

19

Feb-

19

Mar

-19

Apr-1

9

May

-19

Jun-

19

Jul-1

9

Aug-

19

Sep-

19

Oct-1

9

Nov-

19

1 month 2 years 10 years

Government bond yields%

Note: Average interest rate calculated from 5 commercial banks (BAY, BBL, KBANK, KTB, and SCB). Average deposit rate does not include saving rates for BBL’s large depositors. Data as of 24 Dec 19

11/25

The MPC is still concerned over baht appreciation against trading partner currencies, despite its slower pace and two-way movements. The MPC will continue to

closely monitor FX developments and effectiveness of measures on capital outflows, as well as consider the necessity of implementing additional measures.

Source: Bank of Thailand and Reuters

USDTHB and NEER

28.0

29.0

30.0

31.0

32.0

33.0

34.0859095

100105110115120125130

Jan Apr Jul Oct Jan Apr Jul Oct

USDTHBIndex (Jan 2012=100)

NEER

USDTHB (RHS)

appreciation

Investors’ outlook on the baht

*BOT announced the relaxation of foreign exchange regulations to encourage capital outflows and lessen pressures on the baht (6 Nov 19)

Measures on capital outflows*

28

29

30

31

32

33

34

35

4Q20

18

1Q20

19

2Q20

19

3Q20

19

4Q20

19

1Q20

20

2Q20

20

3Q20

20

4Q20

20

USDTHB Median Max Min

Q4-61 Q1-62 Q2-62 Q3-62 Q4-62 Q1-63 Q2-63 Q3-63 Q4-63

USDTHB

The baht may weaken due to BOT measures and narrowing current account surplus outlook.

The baht may strengthen as some credit rating agencies upgraded Thailand’s credit rating outlook.

Source: Bloomberg, data as of 16 Dec 2019

12/25

12 Jul 19 6 Nov 19

• Enhance measures to prevent Thai baht speculation (NRBA and NRBS)

• Increase reporting requirements for non-residents’ holdings of debt securities (UBO)

Measures to enhance surveillance of short-term capital inflows

Relaxation of FX regulations to encourage capital outflows and lessen pressures on the baht

• Exemption on repatriation of export proceeds• Investment in foreign securities • Outward transfers• Settlement of domestic gold trading in foreign

currency

Source: Bank of Thailand

The MPC supported BOT measures to enhance surveillance of short-term capital inflows and the relaxation of FX regulations to promote capital flow balance and lessen pressures on the baht

Further details in Box: Measures to manage the baht and capital flows in 2019

13/25

Financial stability remained sound overall, but a build-up of vulnerabilities continued amid economic slowdown and a low-for-long interest rate

There remains pocket of risks that could pose vulnerabilities to the Thai financial system

• Speculations and imbalances in the real estate market showed signs of abating in line with the LTV measure’s intended objectives. However, oversupply of condominium and adjustments of developers must be monitored.

• Debt situations of household and SME remain vulnerable as (1) household debt to GDP elevatesand is expected to rise amid economic slowdown and (2) credit quality of SMEs continues to deteriorate.

• A low-for-long interest rate led to further build-up of vulnerabilities, both through corporate funding activities and search-for-yield behavior i.e. an increase in corporate issuances of high-yield bonds.

• Interconnectedness among saving cooperatives system increased as they engaged in deposit-taking and borrowing activities, while search-for-yield behavior continued.

Large conglomerates

Household and SME debt

Property

Saving coops

Source: Bank of Thailand

14/25

LTV measure had no impact on buyers with real demand

Source: Bank of Thailand

Average loan-to-value (LTV) ratio in the banking system

Average LTV ratio of second and subsequent mortgage contracts declined due to more tightened credit underwriting standards,

while first mortgage contract was unaffected. %

88.9 88.7

87.7

81.7

70

75

80

85

90

95

100

14Q1

15Q1

16Q1

17Q1

18Q1

19Q1

1st contract 2nd and subsequent contracts

New mortgage loans

Note : *Calculated based on data on new mortgage loans in the banking system, where data on 1st and 2nd and subsequent contracts can be separated.

Speculations in the real estate market were subdued, especially for condominium, as reflected in a contraction in second and subsequent

mortgage contracts for condominium.

New mortgage loans(%YOY) Low-rise Condominium Total

Banking system and SFIsJan – Nov 19

11.8 -7.4 6.3

Only banking system*

1st contract 5.0 -1.9 3.1

2nd and subsequent contract -10.4 -25.3 -17.4

15/25

Note: Data as of Q2/2019 for all countries except Malaysia whose data is as of 2017Other loans, in the case of Thailand, comprises of loans for purchasing securities and for other purposes.

Source: CEIC, Bank of Thailand, Hong Kong Monetary Authority, Monetary Authority of Singapore, Bank Negara Malaysia, Bank of Korea, Bank of England, Bangko Sentral ng Pilipinas, calculations by Bank of Thailand

87 75 71 71 68 6652 52 40 34

13324

1835

0

20

40

60

80

100

Singa

pore

Cana

da US

Japa

n

Hong

Kon

g

Sout

h Ko

rea

Mal

aysia

Philip

pine

s

Thail

and

OtherEducationBusinessPersonalCredit cardAutoMortgage

Share of total household debt (%)

UK

Thailand

Other countriesOtherMortgage

Household debt compositionclassified by purpose

Mortgage, 24.4%

Auto, 17.1%

Business, 17.0%

Credit card, 15.2%

Personal, 26.3%

Personal consumption,

41.5%

Ratio of household debt burden(principle and interest expense) classified by purpose

Note: Data as of Q2/2019, calculations exclude loans for purchasing securities Source: Bank of Thailand and National Credit Bureau, calculations by Bank of Thailand

Further details in Box: Thailand’s household debt composition and implications on financial positions

Thai households bore high monthly debt burden, mostly for personal consumption, with short repayment period but high interest rate

16/25

The MPC expressed concerns over elevated household debt that is expected to increase, which should be addressed through targeted approaches and in cooperation with all relevant agencies

The policy rate, microprudential and macroprudential measures, as well as structural measures should be appropriately combined and well-targeted, with consideration of an appropriate timing.

• Debt restructuring such as debt clinic and refinancing• Promoting financial discipline and saving behavior among households• Promoting appropriate application of responsible lending practices

Addressing household debt requires understanding of different groups of households such as households with high debt and vulnerability, and households without financial discipline

DSR The MPC will monitor debt-service-ratio (DSR) data in accordance with the standardized calculation methodology where financial institutions started to report DSR data since the end of 2019

17/25

Key assessment

Voted unanimously to maintain the policy rate

at 1.25 percent

The Monetary Policy Committee’s Decision

No.7/2019 Date 6 Nov 19

Voted 5 to 2 tocut the policy rate by 0.25

percentage point from 1.50 to 1.25 percent

• The Thai economy would expand at a lower rate than previously assessed and further below its potential. Headline inflation was projected to be below the lower bound of the inflation target.

• Most members viewed that a more accommodative monetary policy stance would contribute to economic growth and support the rise of headline inflation toward target. Two members viewed that the policy rate cut might not lend additional support to economic growth while there remained a need to preserve policy space.

• The Committee supported the relaxation of FX regulations to encourage capital outflows and alleviate pressures on the baht, and saw the need to closely monitor developments of exchange rates and would consider implementing appropriate measures in addition if necessary.

• The Thai economy would expand at a lower rate than the previous forecast and below its potential. Headline inflation was projected to be below the lower bound of the inflation target.

• The global economic outlook started to stabilize, resulting in an improving outlook for Thai exports and economic growth in 2020.

• Given concerns over baht appreciation against trading partner currencies, despite its increasingly two-way movements, the committee saw the need to closely monitor FX and effectiveness of implemented measures, as well as consider the necessity of implementing additional measures.

The Committee would be data dependent by closely monitoring the developments of the outlook of growth, inflation, and financial stability, together with associated risks in deliberating appropriate monetary policy going forward. The Committee would stand ready to use policy tools as appropriate.

No.8/2019 Date 18 Dec 19

18/25

Monetary policy target for the medium-term horizon and the target for 2020

Headline inflation target

0

1

2

3

4

5

2.5% ± 1.5% 1 - 3%

%YoYOld New

The headline inflation targetwithin the range of 1-3 percent

1

2

3

Lower the headline inflation target in line with economic and financial conditions and changing inflation dynamics driven by structural factors

Adopt the range taget (without midpoint) to enhance monetary policy flexibility in the midst of highly volatile and uncertain global economic circumstances

Improve the criteria for issuing an open letter in the case that headline inflation breaches the announced target to show accountability of the MPC and communicate with the public in a timely manner, in consistent with the forward-looking nature of monetary policy formulation

Source: Bank of Thailand

19/25

An average of headline inflation in 2019 and in 2020 are projected to be below the lower bound of the inflation target

Energy inflation decreased• Domestic retail oil prices fell in line with

global crude oil prices and due to price management by the Energy Fund Administration Institute.

• Baht appreciation contributed to lower costs of oil imports

Note: Figure in ( ) denotes weight of corresponding goods and services in headline inflation baskets at the 2015 base yearSource: Ministry of Commerce, calculations by Bank of Thailand

%YoY 2018 2019 2020 forecastsHeadline inflation (100%) 1.07 0.71 0.8

Fresh food inflation (15.69%) -0.63 4.21 n.a.Energy inflation (11.75%) 5.66 -2.68 n.a.Core inflation (72.56%) 0.71 0.52 0.7

Core inflation declined• The Thai economic slowdown• High-base effect from the increase in

excise tax on tobacco

Fresh food inflation increased• The drought pushed up prices of

vegetables and fruits • Prices of pork and eggs rose on account of

lower supply

Structural factors are key contribution to a persistently low inflation

Expansion of e-commerce

Technologicaladvancement

Aging society

20/25

Special issue:Savings – Investment gap,

the reflection of Thailand’s economic imbalances

Trade balance : wider surplusdue to oil prices and low imports

Service balance : wider surplusespecially owing to a number of Chinese tourists

Public S-I Gap : slightly negative• Falling savings in line with income• Low investment growth

Household S-I Gap : always positiveAlthough overall saving increased, it was still lower than in 1997 and

concentrated among the high-income group.Corporate S-I Gap : more positive in recent periods • Low and declining domestic investment • Rising savings

Thailand’s S-I Gap became more positive

Economic sector

S-I Gap / GDP (%)

Avg. 2010-2013

Avg. 2014-2017

Thailand 2.2% 9.4%

Public -0.7% -0.9%

Household 5.2% 5.4%

Corporate -2.3% 4.9%

Savings - Investment gap: the reflection of Thailand’s economic imbalanceshas implications on potential growth, income distribution, and financial stability

Thailand’s large current account surplus

21/25

Labor income share in the global economy continued to decline, where technological change was the catalyst.

Households rely increasingly on debt-financed consumption.

Private sector reduced investment in fixed capital, while raising investment in financial assets.

Global trend

Aging society takes place faster than neighbouring countries, pushing down growth of domestic investment.

Income & wealth distribution remains a chronic issue.

Household debt situation worsened due to lack of financial discipline.

Competition policy partly led to a concentration of profits among large corporates.

Fiscal sustainability Government revenue tends to fall, while its spending will face greater challenges from aging society and other factors.

Thailand-specific factors

• Aging society• Income distribution• Institutional factor

Debt & spendingdiscipline

Thailand’s structural problems were partly influenced by global trend and partly due to country-specific factors, resulting in weak domestic demand

Fiscal sustainability• Declining tax revenues

& tax base• Higher spending due to

aging trend and short-term stimulus measures

Global

trend

22/25

-10.0

-5.0

0.0

5.0

10.0

15.0

20.0

2010 2011 2012 2013 2014 2015 2016 2017

Household Corporate PublicBOT Total

% to GDP Thailand’s Savings-Investment Gap

15

25

35

45

1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017

World ThailandLower-middle Income Upper-middle incomeHigh income

% to GDP

Thailand’s investment has been declining since 2014. A decline was larger than other groups of countries.

15

25

35

45

1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017

World ThailandLower-middle Income Upper-middle incomeHigh income

% to GDP

Meanwhile, Thailand’s savings have been rising since 2014 and were larger than that of upper-middle income group in 2017.

S-I Gap in Thailand widened recently, mainly due to low investment especially of the private sector, while savings increased slightly.

23/25

Average propensity to save of households has been rising since 2014.(but still lower than in 1997)

40

50

60

70

80

0

5

10

15

20

1993 1996 1999 2002 2005 2008 2011 2014 2017

Net Household Savings to GDP

Avg. Propensity to Save

Disposable Income to GDP - RHS

% %

Source: National Statistical Office, calculations by Bank of ThailandSource: NESDC, calculations by Bank of Thailand Note: net HH saving to GDP = Avg. propensity to save x disposable income to GDP

60.0

13.0

30.0

29.8

10.0

57.2

0

20

40

60

80

100

No. of households Saving

High-income group(Avg. 97,841 baht per month)

Middle-income group(Avg. 33,463 baht per month)

Low-income group(Avg. 13,515 baht per month)

%

354045505560657075

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

World North America Latin AmericaEU Africa Eastern AsiaASEAN Thailand

% to GDP

Source: ILONote: Eastern Asia includes China, Taiwan, Macau, Hong Kong, Japan, Korea, and Mongolia

At a micro level, savings of Thai households are concentrated, half of which is concentrated among the high-income group

Thai households increasingly rely on debt-finaced consumption, thus HH debt/disposable income has been rising

135

137

139

141

143

145

147

149

757677787980818283

Q1-57 Q1-58 Q1-59 Q1-60 Q1-61 Q1-62

HH debt/GDP

HH debt/GDP (SA)

HH debt/disposable income (RHS)

HH debt/disposable income (SA) (RHS)

% to GDP % of NI

Source: Bank of Thailand

Household Structural changes resulted in a smaller labor income share, affecting consumption, leverages, and savings of households.

Thailand’s labor income share decreased at a faster pace than other countries in recent periods

24/25

Corporate Private investment has been low and there is high concentration of large firms in the corporate sector. Meanwhile, SME competitiveness declines

Source: 1/ From the study on “Towards a Competitive Thailand: The Role of Market Power and Business Dynamism” (2019) by Tosapol Apaitan, Chanont Banternghansa, Archawa Paweenawat, Krislert Samphantharak, the Puey Ungphakorn Institute for Economic Research (PIER)

SMEs, a major source of employment in the Thai economy, have declining competitiveness, especially in second-tier cities. Targeted measures should be implemented, including appropriate competition policy, relaxation of regulations that are burden or costs toSMEs, as well as supporting the inclusive infrastructure and enhancing SME competitiveness.

Dominance of large firms1

There has been rising dominance and rising market power of large firms in the Thai corporate sector, which leads to…

• Low productivity growth • Low chance of survival in foreign markets• Low probability of new product development • Low investment growth

25/25

5% of firms 46% of revenues 60% of profits

26/25

Risks to growth and inflation projections tilt downward.Attachment

Growth forecast

Headline inflation forecast Core inflation forecast

27/25

Attachment

Forecast assumptions

2018*2019 2020

Sep 19 Dec 19 Sep 19 Dec 19

Dubai oil price (USD per barrel) 69.6 64.0 63.4 63.0 62.5

Farm income (% YoY) 2.2 2.0 2.1 -1.0 -0.8

Public expenditure

- Government consumption (billion baht)1/ 2,637 2,762 2,747 2,929 2,889

- Public investment (billion baht)1/ 962 998 987 1,080 1,067

Fed funds rate (% year end) 2.375 1.625 1.625 1.375 1.625

Trading partners’ GDP growth (% YoY)2/ 3.5 2.8 2.7 2.7 2.7

Regional currencies per USD (excl. RMB)3/ 153.8 157.3 156.6 158.0 157.4Note: 1/ Assumption includes spending on infrastructure investment plans

2/ Weighted by each trading partner’s share in Thailand’s total exports 3/ Increasing index represents depreciation. Decreasing index represents appreciation.

* Outturn

28/25

Attachment

Note: * Outturn ** Weighted by 7 trading partners’ shares in Thailand’s exports in 2018:

Singapore (5.3%), Hong Kong (7.1%), Malaysia (6.6%), Taiwan (2.2%), Indonesia (5.7%), South Korea (2.8%), and Philippines (4.5%)

*** Weighted by 13 trading partners’ shares in Thailand’s exports in 2018 (including the UK and Australia)

Assumption on trading partners’ GDP growth

% YoY Weight 2018*2019 2020

Sep 19 Dec 19 Sep 19 Dec 19

United States 15.9 2.9 2.3 2.3 1.7 1.7

Euro Area 10.3 1.9 1.2 1.2 1.3 1.1

Japan 14.1 0.3 1.0 1.0 0.2 0.4

China 17.1 6.6 6.1 6.1 5.8 5.8

Asia** 34.2 4.1 2.9 2.6 3.3 3.1

Total*** 100 3.5 2.8 2.7 2.7 2.7