The Bank of Thailand (BOT) has said the Kingdom’s economic activity in March came under pressure from rising coronavirus infections and higher inflation driven by increasing energy prices, following a recovery in the previous month.
According to the central bank, overall business activity was steady in March, while the baht depreciated following an escalation of the Russia-Ukraine conflict.
Senior BOT Director Chayawadee Chai-Anant told a news conference, however, that the Thai economy should remain on the recovery path.
She said the economy in “the first quarter recovered but not strikingly, compared with a very good fourth quarter,” adding that the recovery was expected to continue in the second quarter of this year.
The economy grew a faster-than-expected 1.9% in the fourth quarter of 2021 from a year earlier.
On Wednesday, the BOT trimmed its 2022 economic growth forecast to 3.2% from 3.4% and raised its headline inflation to 4.9%, above its target range of 1%-3%, due to the impact of the war in Ukraine.
The BOT said in a statement that the economy in February recovered due to stronger exports and more foreign tourists after an easing of coronavirus curbs that also helped improve manufacturing.
Exports, a key driver of growth, rose 16.0% in February from a year earlier, with imports up 14.2% year-on-year, resulting in a trade surplus of $3.4 billion.
The country recorded a current account deficit of US$652 million in February after seeing a deficit of $2.2 billion in the previous month.