Thailand: Central bank adjusts GDP growth forecast for 2005 upward.

(From Thai Press Reports)

Section: Economy - The Bank of Thailand (BoT) has raised its 2005 economic growth forecast to between 4.25% and 4.75% this year, citing evidence of an improved economic outlook in the second half, the Bangkok Post reports.

The central bank, which had projected 2005 growth of 3.5% to 4.5%, maintained its growth forecast of 4.5% to 6% for 2006 in its latest Inflation Report. Inflation for 2005 is projected at 4.5% to 5% before falling slightly to 3.5% to 5% next year.

Core inflation, which excludes food and energy prices, is projected at 1.5% to 2% this year and between 2% and 3% in 2006. Suchada Kirakul, the senior director for the central bank's Domestic Economy Department, said high growth in exports and investment would help boost the economy in the second half of this year. Better conditions for key trading partners and a pickup in agricultural production would be key factors for an improved export outlook.

Thailand's key trading partners are expected to average 4% growth this year, up from 3.9% in the last forecast. Recent trade figures have shown a pickup in exports, with shipments of computer parts, integrated circuits, vehicles, plastics, processed foods, rubber and shrimp all rising in July and August compared with last year. The Commerce Ministry earlier this week announced a September trade surplus of $820 million, the largest for the year, thanks to monthly export growth of 22.08%. For the first nine months of the year, exports totalled $82 billion, up 16.12%, while imports rose 27.95% to $89.4 billion.

"We are not being overly optimistic about the forecast after surveying [property] developers and the latest data. ...