Monetary Policy Group September 2020

https://www.bot.or.th/English/MonetaryPolicy/EconomicConditions/PressRelease/Pages/default.aspx

Economic and Monetary Conditions August 2020

Economic and Monetary Conditions, August 2020

Content 1 Executive Summary 1

2 The Thai Economy 3

2.1 Supply 3 Agricultural sector Manufacturing sector Service sector

2.2 Domestic Demand 5 Private consumption Private investment Fiscal position

2.3 The global economy and external sector 7 The global economy External sector Balance of payments

2.4 Monetary and financial conditions 9 Corporate financing Interest rates Exchange rates

2.5 Financial stability 10 Inflation Labor market External stability

3 Link to related statistics and contents 12

Economic and Monetary Conditions, August 2020

1

1. Executive Summary

In August 2020, the Thai economy slightly improved, held up by lighter contractions in merchandise exports value, manufacturing production and private investment indicators. In addition, public spending, excluding transfers, had greater expansion. However, private consumption indicators contracted further after positive effects of special extended holiday in the previous month terminated. Meanwhile, the tourism sector persistently experienced severe contraction due to travel restrictions on foreign tourist arrivals.

On the economic stability front, headline inflation recorded a softer negative on the back of the increase in fresh food and energy prices. Labor market improved but remained vulnerable. The current account was a surplus largely contributed by gold exports. The capital and financial accounts posted a deficit owing to the liability position.

Details of the economic conditions are as follows: The value of merchandise exports contracted by 8. 2 percent from the same period last year.

Excluding gold export, recording at the historical high, the value of merchandise exports contracted by 13.6 percent, a lesser contraction from 14. 3 percent in the previous month. This attributed by improvement in exports of petroleum- related products, automotive and parts and electrical appliances, consistent with gradual recovery of demand in trading partner countries. However, agricultural products contracted deeper, especially fruits exported to China, after having accelerated in the preceding period. Manufacturing production had a softer contraction in almost all categories, aligning with the gradual recovery in the merchandise exports and domestic spending.

Private investment indicators marked lighter contraction as compared to the previous month, mainly from investment in machinery and equipment. This evidenced by the improvement in imports of capital goods and the number of newly registered motor vehicles align with modest recovery in domestic and external demand as well as the upturn momentum in business sentiment despite being at the low level. Meanwhile, investment in construction expanded at a slightly softer pace, following construction material sales.

The value of merchandise imports contracted by 19. 1 percent from the same period last year, exhibited softer contractions in all categories of products as compared to the previous month; notably consumer products, capital goods, and raw materials and intermediate goods, in line with the improvement in overall economic activities.

Private consumption indicators were still on a recovery path in line with factors supporting consumer purchasing power. This exhibited by gradual improvement in employment condition, household income and consumer confidence, despite private consumption indicators contracting deeper this month. The reversion led by higher contraction in non-durable goods and services spending after positive effects of special extended holiday last month terminated. Meanwhile, spending on durable goods continued to contract at a lower rate, partly due to the purchase of new passenger car model entered the market in the previous month.

The number of foreign tourist arrivals continued to contract severely at 100 percent from the same period last year. Thailand received no foreign tourist arrivals for the fifth consecutive months as international travel restrictions remained in place.

Economic and Monetary Conditions, August 2020

2

Public spending, excluding transfers, had greater expansion attributed by marked expansion in capital expenditures from the central government. However, current expenditures slightly contracted due to purchases on goods and services. Meanwhile, state enterprises’ capital expenditures shrank from disbursement of transportation agencies.

On the overall economic stability, headline inflation recorded a softer negative, on the back of the increase in fresh food and energy prices, while core inflation declined slightly. In respect of labor market, the unemployment rate came down lightly but the number of workers registered for jobless claims remained high. The current account was a surplus largely contributed by gold exports. The capital and financial accounts posted a deficit owing to the outflow in liabilities, led by the net sell-off on Thai equity securities by foreign investors and the loan repayment by Thai depository financial corporation.

Economic and Monetary Conditions, August 2020

3

2.1 Supply

Farm income expanded at a higher rate, mainly as a result of an increase in agricultural prices. Manufacturing production contracted at a slower pace, corresponding to the improvements of exports and private consumption indicators. Services sector contracted at a slower pace as compared to the previous month, following gradual improvement of economic activities.

Nominal Farm Income

Manufacturing Production Index (MPI) Classified by Export Share

Manufacturing Production Index (MPI)

Real Farm Income

Other Indicators of Manufacturing Production

Capacity Utilization (sa)

(%YoY)

H1 H2 H1 Q1 Q2 Jul Aug

Nominal farm incomeP 1.4 2.0 1.2 -6.9 -6.3 -6.4 3.0 9.1

Agricultural productionP -0.4 1.2 -1.7 -10.1 -13.9 -5.1 1.0 1.2

Agricultural price 1.8 0.8 2.9 3.6 8.8 -1.4 2.0 7.7

Note: Farm income does not include government subsidies and transfers. P = Preliminary dataSource: Office of Agricultural Economics and calculated by Bank of Thailand

Index sa(Jan 2014 = 100)

405060708090

100110120

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan 2018

Jul Jan 2019

Jul Jan 2020

Jul

Export<30% 30%<Export<60% Export>60%

Sources: Office of Industrial Economics , calculated by Bank of Thailand

0.5 %

20.0 %-1.8 %

%MoM sa

Index sa (Jan 2014 = 100)

Source: Office of Agricultural Economics and calculated by Bank of Thailand

60708090

100110120

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Real farm income sa Real farm income sa, 3mma

75

85

95

105

115

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan 2018

Jul Jan 2019

Jul Jan 2020

Jul

Industrial Electricity Consumption*Quantity of Imported Raw MaterialsIndex of Work Hours in Manufacturing (3mma)**

** As the data from April to June 2020 was not published, the index was estimated from the Q2 2020 data.

Index sa(Jan 2014 = 100)

Sources: NSO, OIE, Customs Department and seasonally adjusted by Bank Of Thailand

%MoM sa

-1.3 %

2.2 %-0.1 %

* The latest month was estimated by the BOT

(%)Share 016R

2019 2020

Q2 Q3 Q4 Q1 Q2 Jul AugP

Food & Beverages

Automotives

Petroleum

Chemicals

Rubbers & Plastics

Cement & Construction

IC & Semiconductors

Electrical Appliances

Textiles & Apparels

Hard Disk Drive

Others

CAPU sa

Source: Office of Industrial Economics

Note: the new Capacity Utilization series as adjusted by the OIE (coverage and base year at 2016)R = 2019 Revision P = Preliminary data

Note: the new MPI series as adjusted by the OIE (coverage and base year at 2016)R = 2019 Revision P = Preliminary dataSource: Office of Industrial Economics and seasonally adjusted by Bank of ThailandProduction index of petroleum does not include the production of diesel B10 and B20

(%YoY)Share 016R 2019

2019 2020

H1 H2 H1 Q1 Q2 Jul AugP %MoM sa

Food & Beverages Automotives - Passenger Cars - Commercial Vehicles - Engine Petroleum Chemicals Rubbers & Plastics Cement & Construction IC & Semiconductors Electrical Appliances Textiles & Apparels Hard Disk Drive Others MPI MPI sa ∆% from lastperiod

Capacity Utilization (SA)

Economic and Monetary Conditions, August 2020

4

Service Production Index (SPI)

Service Production Index (SPI) by sector

80

90

100

110

120

130

140

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Service Production IndexNon-market Services (share 17%)Market Services (share 83%)

Index sa, 3mma (Jan 2014 = 100)

Note : Latest data estimated by Bank of Thailand Market services covering trade, hotels and restaurants, transportation and telecommunication, financial intermediation, real estate, and business services Non-market services covering public administration and defence, education, health, and social work Source: Office of the National Economic and Social Development Board (NESDB), Ministry of Commerce, National Statistical Office,The Revenue Department, The Office of Industrial Economics ,and Ministry of Tourism and Sports

0

50

100

150

200

250

60

80

100

120

140

160

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Trade (32%) Finance (14%)Professional Services (4%) Transport (8%)Information (5%) Hotel & Restaurant (10%, RHS)

Index sa, 3mma (Jan 2014 = 100)

Note : Latest data estimated by Bank of Thailand Source: Office of the National Economic and Social Development Board (NESDB), Ministry of Commerce, National Statistical Office,The Revenue Department, The Office of Industrial Economics ,and Ministry of Tourism and Sports

Index sa, 3mma (Jan 2014 = 100)

Economic and Monetary Conditions, August 2020

5

2.2 Domestic Demand Private consumption indicators were still on a recovery path, despite contracted further after the positive effects

of special extended holiday in the previous month terminated. Private investment indicators marked lighter contraction, mainly from investment in machinery and equipment. Nevertheless, public spending, excluding transfers, continued to expand from the same period last year attributed by marked expansion in capital expenditures from the central government.

Private Consumption Indicators

Nielsen’s FMCG Index & Fuel Index

Consumer Confidence Index

Durable and Semi-durable Indices

Service Index* & Net Tourist Spending Index**

Private Investment Indicators

30405060708090

100

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Total CurrentNext 6 months Average 5 years

Diffusion Index, sa(Unchanged = 100)

Average 5 years = 76.2

Source: The University of the Thai Chamber of Commerce, calculated by Bank of Thailand

90100110120130140150160

90

95

100

105

110

115

120

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Nielsen’s FMCG excl. alcohol and tobacco, 3mma

Fuel, 3mma (RHS)

Source: The Nielsen company and Department of Energy Business, calculated by Bank of Thailand

Index sa(Jan 2014 = 100)

Index sa(Jan 2014 = 100)

% YoY 20192 2020

H1 H2 H1 Q1 Q2 Jul AugP %MoM

Permitted Construction Area (9mma) -3. - . - .3 - .2 - . - . .3 . - .3

Construction Materials Index - . . -2. . - .3 2. . .2 -3. Real Imports of Capital Goods - .2 - .2 -2. - . - .3 - . -2 . - . . Real Domestic Machinery Sales - . -3. - . - .2 . -2 .2 - 2. - 3. . Newly Registered Motor Vehicles for Investment -3. 2. - . - . - . -2 . - . - . .2

Private Investment Index -2. - .3 - . - . - . - 2. - . - . - .2

Note: %MoM is calculated from seasonally adjusted data P = Preliminary DataSource: Bank of Thailand

Note: * Comprises of the VAT on hotel and restaurant sector and the sale of transportation sector** Expenditure of non-resident in Thailand subtracted by expenditure of resident abroad

Source: Bank of Thailand

020406080100120140160180

8090

100110120130140

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Service, 3mma Net tourist spending, 3mma (RHS)

Index sa(Jan 2014 = 100)

Index sa(Jan 2014 = 100)

70

80

90

100

110

120

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Semi-durable, 3mma Durable, 3mma

Source: Bank of Thailand

Index sa(Jan 2014 = 100)

%YoY 20192019 2020

H1 H2 H1 Q1 Q2 Jul AugP %MoM sa

Non-durables index 2.2 3.1 1.3 -2.7 1.2 -6.8 -0.4 -1.4 -1.0Semi-durables index 0.5 1.2 -0.1 -3.7 -1.7 -5.8 -5.5 -4.6 -0.7Durables index -2.0 2.7 -6.2 -20.4 -12.0 -29.1 -15.7 -9.6 5.3Services index 2.9 3.1 2.7 -19.0 -9.9 -28.2 -23.6 -25.6 -1.2(less) Net tourist expenditure 0.0 -0.3 0.2 -60.6 -43.3 -87.2 -92.4 -93.0 -10.1

PCI 2.5 3.5 1.6 -4.2 2.1 -10.3 -0.1 -1.1 -0.6Note: %MoM is calculated from seasonally adjusted data P = Preliminary DataSource: Bank of Thailand

Economic and Monetary Conditions, August 2020

6

Investment in Machinery and Equipment

Business Sentiment Index

Central Government Current Expenditure (Excl. Subsidies/Grant and Other)

State Owned Enterprises Capital Expenditure

Investment in Construction

Fiscal Position (Cash basis)

Central Government Capital Expenditure (Excl. Subsidies/Grant and Other)

0.0

10.0

20.0

30.0

40.0

Oct Dec Feb Apr Jun Aug

avg. FY2018-19 FY2019 FY2020

Billion baht

Aug-25.4%

010203040506070

Oct Dec Feb Apr Jun Aug

avg. FY2017-19 FY2019 FY2020

Billion baht

Source: Comptroller General’s Department, Fiscal Policy Office and Bank of Thailand

Aug47.0%

60

80

100

120

140

160

180

Oct Dec Feb Apr Jun Aug

avg. FY2017-19 FY2019 FY2020

Billion baht

Aug-2.0%

Note: P = Preliminary data 1/ Includes cash payments for operating and purchase of non-financial assets, except loan repayments 2/ Excludes loan principal and interest payment

Billion baht FY2018 FY2019FY2019 FY2020

Q2 Q3 Q4 Q1 Q2 Q3 Jun Jul AugRevenue 2, 3 2, 3 3 2 3 2 (%YoY) ( . ) ( . ) (2.3) (2. ) (- . ) ( . ) (-2. ) (-3 . ) (-33. ) ( 2. ) (- . )Expenditure1/ 2, 2 2, 2 223 3(%YoY) (3. ) (3.2) ( . ) (- . ) ( . ) (- 3. ) ( . ) (2 . ) ( .2) (-3. ) ( .3)Budgetary B/L -3 - 3 - 2 - - -22 -2 - - 2 -3 Non-Budgetary B/L -2 2 -2 23 2 - 2 - - -2 - -23Cash B/L (CG) -3 -3 - 2 -3 -2 3 -23 - -3 - - Primary balance 2/ -2 - - 3 3 -2 -2 -22 -3 3 - - Net Financing -3 Treasury B/L 33 3 2 3 3 3 3 32 3

Source : Bank of Thailand

Diffusion Index (Unchanged = 50)

30

40

50

60

Jan 2014

Jul Jan 2015

Jul Jan 2016

Jul Jan 2017

Jul Jan 2018

Jul Jan 2019

Jul Jan 2020

Jul

BSI Expected BSI (next 3 months)

Nov 20 50.9

Aug 2045.7

1,000 m2

9mmaIndex sa

(Jan 2014=100)

Note: All data is in real terms.Source: NSO, Department of Public Works and Town & Country Planning, calculated by Bank of Thailand

4,0004,5005,0005,5006,0006,5007,000

70

80

90

100

110

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Construction Materials IndexPermitted Construction Area (RHS)3 per. Mov. Avg. (Construction Materials Index)

Index sa(Jan 2014 = 100)

Note: All data is in real terms.Source: Department of Land Transport, Customs Department, Revenue Department, calculated by Bank of Thailand

60

80

100

120

140

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Real Imports of Capital Goods Real Domestic Machinery SalesCar Registered for Investment

Economic and Monetary Conditions, August 2020

7

2.3 The Global Economy and External Sector

The value of merchandise exports (including and excluding gold) exhibited lesser contractions compared to the previous month, with the value of gold export recorded at its historical high. The improvement was consistent with gradual recovery of demand in trading partner countries. Meanwhile, the number of foreign tourists continued to contract severely due to international travel restrictions. The current account continued to run a surplus largely contributed by gold exports. The capital and financial accounts shown a slight deficit from liabilities outflow.

G3 Retail Sales

Export Value

Net Financial Flows

Asia Export Performance

Import Value

Balance of Payments

85

95

105

115

125

Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

US (Aug) Euro Area* (Jul) Japan (Jul)

Note: *Volume Index Source: Bloomberg

Index (Jan 2015 = 100)

Aug 20

70

80

90

100

110

120

Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Index sa, 3mma (Jan 2015=100)

Note: Thai export excludes gold. Indonesian export excludes oil&gas.Source: CEIC, Customs Department, calculated by Bank of Thailand

PHIDMY

TH

TWCN

SG

KR

%MoM calculated from seasonally adjusted data. P = Preliminary data.Note: Data above are recorded by custom basis, except total export value which is recorded by BOP basis. Custom basis considers recording as goods pass through Customs, while BOP basis considers changes in ownership between residents and non-residents.Source: Compiled from Customs Department’s data

%YoYShare 2019

2019P

2019P 2020P

H1 H2 H1 Q1 Q2 Jul AugAug

(%MoM)

Agriculture . . . . . . .2 . . . Fishery . . 2. .2 . . 2. . 2 . . Manufacturing . . . .2 . . 2 . .2 2. .

Agro-manufacturing 2. .2 2.2 2. . . 2.2 2. .2 . Electronics . . . . . . . 2. . .

Electrical Appliances . . . . . . . 2.2 . .

Automotive . . .2 . 2 . .2 . 2 . 22. .2Machinery & Equipment . .2 . . . . 2 . . . .

Petroleum Related . . . . . . 2 . 22. . 2. Total (BOP Basis) . . . 2. .2 . . . .2 .

Ex. Gold . . . 2. .2 2 . . . 2. Ex. Gold & Petroleum Related . . 2. . 2. 2 . . . 2.

Aug 2020 = 20.1 Bn USD

Ex. gold = 17.3 Bn USDJul 2020 = 18.5 Bn USD

Ex. gold = 16.9 Bn USD

%YoYShare 2019

2019P

2019P 2020P

H1 H2 H1 Q1 Q2 Jul AugAug

(%MoM)

Consumer .2 . . . . . . . . . Raw material & Intermediate . .2 . . . . 2 . 2 . 2 . .2

o/w Fuel . 2. . 22. 2 . . . . . . o/w Raw mat & Interm ex. Fuel . . . .2 .2 2. .2 . . .

Capital 2 . 2.2 . 2. .2 . . 2 . . .

Others . . . . 2 . . . . . .

Total (BOP Basis) . . . . 2. . 2 . 2 . . .

Ex. Gold . 2. . . . 2 . 2 . . .

Ex.Gold&Fuel 2. 2. 2. . . . 2 . . 5.4

%MoM calculated from seasonally adjusted data. P = Preliminary data.Note: 1/ Data above are recorded by custom basis, except total import value which is recorded by BOP basis. Custom basis considers recording as goods pass through Customs, while BOP basis considers changes in ownership between residents and non-residents. Source: Compiled from Customs Department’s data

Aug 2020 = 14.7 Bn USD

Ex.Gold = 14.5 Bn USD

Jul 2020 = 14.4 Bn USD

Ex.Gold = 14.3 Bn USD

Millions of USD 2019P 2019P 2020P

H1 H2 H1 Q1 Q2 Jul AugE YTD1. Assets TDI - Equity - Reinvestment of earnings

Thai portfolio investment - Equity security investment - Debt security investment

Loans Other investments - Trade credits - Deposits abroad

2. Liabilities FDI - Equity - Reinvestment of earnings

Foreign portfolio investment - Equity security investment - Debt security investment

Loans Other investments - Trade credits - Deposits abroad

Total financial flows (1+2) Source: Bank of Thailand P = Preliminary data E = Estimated data

Source: Bank of Thailand P = Preliminary data E = Estimated data

Billion USD 2019P201 P 2020P

H1 H2 H1 Q1 Q2 Jul AugE YTDTrade Balance Exports (f.o.b.)

%YoY Imports (f.o.b.)

%YoY Net Services, Income & Transfers Current Account Capital and Financial Account Overall Balance

Economic and Monetary Conditions, August 2020

8

Inbound Tourists by Country of Origin

Tourists Classified by Nationality

%YoY (Share in 2019)

20192019 2020

H1 H2 H1 Q1 Q2 Jul AugP

China (27.6%) . . . . . . . .

Malaysia (10.5%) . . . . 2. . . .

Asia ex. China & Malaysia (30.4%)

. . . . . . . .

Russia (3.7%) . . . 2 . . . . .

Europe ex. Russia (13.2%)

. . . .2 . . . .

India (5.0%) 2 . 2 . 2 . . . . . .

Others (9.6%) . . . . .2 . . . Total(million persons)

.2 (39.8)

. (19.8)

. (20.0)

.2(6.7)

. (6.7)

. (0.0)

. (0.0)

. (0.0)

Source: Ministry of Tourism and Sports

0

50

100

150

200

250

Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Total China (28%) Malaysia (10%)East Asia ex. CN MY (30%) Europe ex. Russia (13%) Russia (4%)India (5%)

Index sa(Jan 2015 = 100)

Note: ( ) denotes share of total tourist arrivals in 2 P = Preliminary dataSource: Ministry of Tourism and Sports, calculated by Bank of Thailand

Aug 20

Economic and Monetary Conditions, August 2020

9

2.4 Monetary and Financial Conditions

Total private financing declined from the previous month, primarily from business credits. The monthly average of Thai baht as measured against the US dollar appreciated, while the NEER depreciated compared with the previous month.

Commercial Bank Interest Rates*

Changes in Total Corporate Financing

Exchange Rates

Regional Exchange Rate Volatility

Government Bond Yields

Net Changes in Outstanding Loans

Exchange Rate Movement

End of Period Bangkok Bank, Krung Thai Bank, Kasikorn Bank, Siam Commercial Bank and Bank of Ayudhya

Source: Bank of Thailand

% p.a.2019 2020

Q1/19 Q2/19 Q3/19 Q4/19 Q1/20 Q2/20 Aug 20 24 Sep 20

-month deposit rate

Average of 5 largest Thai banks**

Average of other Thai banks

Average of foreign branches and subsidiary

MLR

Average of 5 largest Thai banks

Average of other Thai banks

Average of foreign branches and subsidiary

MRR

Average of 5 largest Thai banks

Average of other Thai banks

Average of foreign branches and subsidiary

1.42

1.48

1.19

6.28

7.22

7.58

7.19

7.93

8.54

1.46

1.48

1.19

6.28

7.22

7.58

7.19

7.96

8.54

1.4

1.

1.1

6.28

7.22

7.58

7.79

8.54

1.33

1.51

1.11

6.08

7.19

7.59

7.73

8.44

0.75

1.26

0.84

5.93

7.13

7.41

.64

7.66

8.32

0.49

0.99

0.60

5.36

6.71

6.91

6.00

7.12

7.89

0.49

0.90

0.58

5.36

6.71

6.89

6.00

7.12

7.89

0.49

0.89

0.58

5.36

6.71

6.89

6.00

7.12

7.89

0.0

0.5

1.0

1.5

2.0

2.5

3.0

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

Jan-20

Apr-2

0

Jul-2

0

1D BRP 3M 2Y 5Y 10Y

Sources: Bank of Thailand and ThaiBMA

As of 24 Sep 20

0.50

0.860.57

1.39

0.49

%

Note: (1) Business credits : net changes in outstanding loans extended by other depository corporations, other financial corporations, non-residents and others;

(2) Debt : net changes in outstanding bonds (market value); (3) Equity : new issuance at par valueSources: Bank of Thailand, ThaiBMA, SET

Billion baht

-150-100-50

050

100150200

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

Jan-

20

Apr-2

0

Jul-2

0

Business Credits (SA) Equity Debt 3MMA

Aug 20P

Note: net changes in outstanding loans extended by other depository corporations, other financial corporations, non-residents and others.

Billion baht

-1.7

-1.1

-0.5

0.1

0.7

1.3

1.9

2.5

3.1

-180-140-100-60-202060

100140180220260300340

Jan-

17Ap

r-17

Jul-1

7Oc

t-17

Jan-

18Ap

r-18

Jul-1

8Oc

t-18

Jan-

19Ap

r-19

Jul-1

9Oc

t-19

Jan-

20Ap

r-20

Aug-2

0Ja

n-17

Apr-1

7Ju

l-17

Oct-1

7Ja

n-18

Apr-1

8Ju

l-18

Oct-1

8Ja

n-19

Apr-1

9Ju

l-19

Oct-1

9Ja

n-20

Apr-2

0Au

g-20

MoM, SA % MoM change, SA (RHS)

BusinessHousehold

%

29.0

30.0

31.0

32.0

33.0

34.0

35.0

36.0108110112114116118120122124126128130132

29-D

ec-1

7

16-F

eb-1

8

5-Ap

r-18

28-M

ay-1

8

13-Ju

l-18

3-Se

p-18

19-O

ct-1

8

7-De

c-18

28-Ja

n-19

15-M

ar-1

9

8-M

ay-1

9

26-Ju

n-19

14-A

ug-1

9

30-S

ep-1

9

18-N

ov-1

9

8-Ja

n-20

25-F

eb-2

0

13-A

pr-2

0

2-Ju

n-20

21-Ju

l-20

11-S

ep-2

0

NEER25

USDTHB (RHS)

Note: Monthly average rate Sources: Reuters, calculated by Bank of Thailand

Index (2012 = 100) USDTHB (reverse)

Appreciation

Sep USDTHB = 31.30NEER25 = 121.27

As of 24 Sep 2020 -1.3%

0.0% 0.1% 0.5% 0.7% 0.9% 1.1% 1.2% 1.4% 1.4%1.9%

3.5% 3.9%

-0.8%0.0%

0.6%

1.5%

-0.3%

0.4% 0.8%

1.8%

0.5%0.4%

1.0%

-0.1%

-1.2%-2%

0%

2%

4%

6%

IDR VND TWD INR THB JPY KRW CNY PHP SGD MYR EUR GBP

Avg of Aug 20 compared to avg of Jul 20

Avg of Sep 20 compared to avg of Aug 20

Sources: Reuters, calculated by Bank of ThailandNote: Avg-period data, + = Appreciation against USD

Sep 2020(Average data

until 24 Sep 2020)

Sources: Reuters, Bank of Thailand

% p.a.

0%

4%

8%

12%

16%

20%

24%

29-D

ec-17

30-Ja

n-18

27-Fe

b-18

28-M

ar-18

30-A

pr-18

30-M

ay-18

27-Ju

n-18

25-Ju

l-18

27-A

ug-18

24-Se

p-18

24-O

ct-18

21-N

ov-18

21-D

ec-18

22-Ja

n-19

20-Fe

b-19

20-M

ar-19

22-A

pr-19

23-M

ay-19

21-Ju

n-19

19-Ju

l-19

20-A

ug-19

17-Se

p-19

16-O

ct-19

14-N

ov-19

16-D

ec-19

15-Ja

n-20

13-Fe

b-20

12-M

ar-20

10-A

pr-20

13-M

ay-20

11-Ju

n-20

10-Ju

l-20

11-A

ug-20

11-Se

p-20

HKD THB CNY IDR INR KRW MYR PHP SGD

As of 24 Sep 2020

Economic and Monetary Conditions, August 2020

10

2.5 Financial Stability

Headline inflation recorded a softer negative, on the back of the increase in fresh food and energy prices, while core inflation declined slightly. In respect of labor market, the unemployment rate came down lightly, indicating some improvement. Nonetheless, vulnerabilities remained, as reflected by a high number of workers registered for jobless claims and temporary suspension of business. External stability remained resilient, providing sufficient cushion against global financial market volatility.

Headline Inflation Contribution

Core Inflation Contribution

Unemployment Rate

Employment Index

Employment

Ratio of Jobless Claims to Total Contributors

in Section 33*

-4

-3

-2

-1

0

1

2

3

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Raw food (15.69%)Energy (11.75%)Core Inflation (72.56%)

%YoY

Aug-0.50%

( ) Share in Headline Inflation

Sources: Ministry of Commerce calculated by Bank of Thailand

-1

0

1

2

3

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Rent (19.62%)Food & Beverage (28.17%)Non-Food & Beverage ex. Rent (52.21%)

Sources: Ministry of Commerce calculated by Bank of Thailand

%YoY

Aug0.30%( ) Share in Core Inflation

0.5

1.0

1.5

2.0

2.5

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2020 2019 2018%

Note: Data from 2014 onward are based on The 2010 Population and Housing CensusSource: Labor Force Survey, NSO

Unemployment rate (Jul = 2.1 % ; Aug = 1.9%)Unemployment rate (sa) (Jul = 2.1 % ; Aug = 1.9%)

80859095

100105110115

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Total Agriculture (31%) Manufacturing (17%)Construction (6%) Trade (17%) Service (29%)

Note: The data from April to June 2020 was the Q2 2020 data. Data from 2014 onward are based on The 2010 Population and Housing Census.( ) denotes share in total employment

Source: Labor Force Survey, NSO calculated by BOT

Index sa, 3mma (Jan 2014=100)

Thousand persons sa, 3mma

10,000

12,000

14,000

16,000

18,000

20,000

20,000

22,000

24,000

26,000

28,000

30,000

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

Non-Agriculture (sa, 3mma) Non-Agriculture (sa)Agriculture (sa, 3mma) (RHS) Agriculture (sa) (RHS)Not in Labor Force (sa, 3mma) (RHS) Not in Labor Force (sa) (RHS)

Note : The data from April to June 2020 was the Q2 2020 data.

Thousand persons sa, 3mma

Source: Labor Force Survey (NSO), calculated by BOT

0.8

1.3

1.8

2.3

2.8

3.3

3.8

Jan2014

Jul Jan2015

Jul Jan2016

Jul Jan2017

Jul Jan2018

Jul Jan2019

Jul Jan2020

Jul

%, SA

Jobless Claims

Note: Employees who contribute to social security system (Section ) account for % of total employment.

Source: Social Security office, calculated by Bank of Thailand

Economic and Monetary Conditions, August 2020

11

External Debt Outstanding

External Stability Indicators

Note: *including BOT bonds held by non-residents and SDRs allocations by IMF Source : Bank of Thailand P=Preliminary data E=Estimated data

Billion USD 2019P 2019P 2020P Change Aug20-Jul20H1 H2 H1 Q1 Q2 Jul AugE

1. General government .2 . .2 . 2 . . .2 . .22. Central Bank* . 5. . .2 2.5 .2 2. 2. . 3. Other Depository Corporations (ODC) . . . .5 . .5 . .2 . 4. Other Sectors .2 . .2 . . . . . .

- Other Financial Corporations (OFC) . . . 2 .2 . 2 .2 2 . 2 . . - Non Financial Corporations (NFC) . 5. . . .5 . . . . O/W Foreign Trade Credit 2 .5 2 . 2 .5 22. 22. 22. 22. 2 . .

5. Total . .2 . 2. 5. 2. . 2.5 . Short-term (%) . .2 . . 5. . 5. 5. Long-term (%) 5.2 2. 5.2 . . . . .

Criteria 2019P2019P 2020P

H1 H2 H1 Q1 Q2 Jul AugE

Solvency Indicators Current Account / GDP (%)

Debt / GDP (%) < /

Debt / XGS1/ (%) < /

Debt Service Ratio (%)

Liquidity Indicators

Gross Reserves / ST Debt > 1 time

Gross Reserves / Imports2/ > 3 times

ST Debt / Total Debt (%)

Note: XGS – Export of Goods and Services (3-year average) Monthly Import of Goods and Services (1-year average)

Severely indebted countriesSource : Bank of Thailand P=Preliminary data E=Estimated data

Economic and Monetary Conditions, August 2020

12

3. Link to related statistics and contents

Agricultural sector

Agricultural prices: Agricultural prices

Agricultural production: Agricultural products

More information: Office Of Agricultural Economics www.oae.go.th Manufacturing sector

Manufacturing production: Manufacturing production index (MPI)

Capacity utilization rate: Capacity utilization rate

More information: Office of Industrial Economics http://www.oie.go.th/view/1/Home/EN-US

Real estate sector

Property Indicators: Property Indicators (EC_EI_009_S2)

More information: Real Estate Information Center www.reic.or.th/

Public finance

Central government revenue: Government revenue

Central government expenditure (GFSM2001): Government expenditure (EC_PF_011)

Fiscal Position (GFSM2001): Fiscal position in cash basis (EC_PF_009)

More information: Fiscal Policy Office www.fpo.go.th Labor market

Labor force survey: Labor force survey (EC_RL_009_S4)

Employment: Number of employed persons classified by occupation (EC_RL_012)

Average wage: Average wage classified by industry (EC_RL_014_S2)

More information: National Statistical Office www.nso.go.th

Economic and Monetary Conditions, August 2020

13

Inflation

Inflation: Consumer price index (CPI)

More information: Bureau of Trade and Economic Indices www.price.moc.go.th

Other reports of Monetary Policy Group, Bank of Thailand

Monthly report on Business Sentiment Index: Business Sentiment Index

Quarterly report on Business Outlook: Business Outlook Report

Quarterly report on Credit Condition: Senior Loan Officer Survey

Economic and Monetary Conditions, August 2020

14

Contact

Agricultural sector Sectoral Analysis Division 0 2283 6637

Manufacturing sector Sectoral Analysis Division 0 2283 5650

Service sector Sectoral Analysis Division 0 2356 7300

Real estate sector Macro Surveillance Team 1-2 0 2356 7096

Private consumption Macroeconomics Team 1-2 0 2283 5647

Private investment Macroeconomics Team 1-2 0 2283 5639

Public finance Public Finance Team 0 2356 7877

The global economy International Economics Division 0 2283 5147

External sector and balance of payments Balance of Payment Division 0 2283 6726

Monetary and financial conditions Monetary Policy Strategy Division 0 2283 6186

Inflation Macro Surveillance Team 1-2 0 2283 7090

Labor market Sectoral Analysis Division 0 2283 5645

Financial Stability Macro Surveillance Team 1-2 0 2356 7098

Financial Position Macro Surveillance Team 1-2 0 2356 7098

External stability Balance of Payment Division 0 2283 5636