The Thai economy grew 3.7 percent YoY in 4Q18, increasing over that reported for 3Q18, thanks to easing external risks and continuing growth seen in domestic spending. The trade war continued to cause 4Q18 exports to expand at a slower pace from 3Q18. Many Asian economies were also affected by the trade war. Meanwhile, Thai tourism bounced back in 4Q18, thus helping ease external risks.
Looking into 1H19, it is expected that the Thai economy will grow lower than our full-year growth forecast for 2019 at 4.0 percent due to the high 1H18 base, plus internal and external uncertainties. External uncertainties include the unresolved US-China trade dispute, no deal Brexit and signs that the Chinese and Eurozone economies will slowdown further than our assessment. Internal uncertainties include political situation after the general election slated for March 24, 2019. Although related activities may help spur cash flow in the economic system, investors have now adopted a wait-and-see attitude. If the general election goes well, that will be a boon for the Thai economy during 2H19. Given this, we at KResearch expect that the Thai economy will expand at 4.0 percent or within 3.5-4.2 percent during 2019.