Thai Baht, Stocks Gain as First-Quarter Growth Beats Estimatesby and
NESDB amends 2016 projection to 3 percent to 3.5 percent
Prime minister’s stimulus spending helping shore up economy
Thailand’s baht and stocks rose after Southeast Asia’s second-biggest economy expanded more than analysts estimated, spurred by the military government’s increased spending.
The currency climbed 0.3 percent to 35.366 per dollar as of 4:14 p.m. in Bangkok, halting a five-day loss, according to data compiled by Bloomberg. It was the baht’s biggest gain since April 29. The SET Index of shares increased 0.2 percent.
Prime Minister Prayuth Chan-Ocha has issued a series of stimulus measures worth more than 400 billion baht ($11 billion) since last year to help shore up local demand. The Bank of Thailand last week left its benchmark interest rate unchanged for an eighth straight meeting to help support growth. Gross domestic product increased 3.2 percent in the three months through March from a year earlier, the National Economic and Social Development Board reported Monday. That compares with the 2.8 percent median estimate in a Bloomberg survey.
“The much stronger-than-expected data provides support for the baht,” said Kozo Hasegawa, a Bangkok-based currency trader at Sumitomo Mitsui Banking Corp. “With this data, speculation of a further rate cut is probably fading a bit, however downside risks to growth remain.”
The baht may trade between 35.25 and 35.55 per dollar this week, said Hasegawa. The 10-year bond yield rose two basis points to 1.82 percent and the two year climbed one basis point to 1.38 percent.
GDP grew 0.9 percent from the previous three months, compared with a 0.6 percent forecast. The NESDB now predicts the economy will expand 3-3.5 percent in 2016, from an earlier projection of 2.8-3.8 percent.