MACROECONOMICS WEEKLY UPDATE

The country’s consumer price index (CPI), a key indicator of inflation, rose 5.89 percent year on year in December, accelerating from a 7-month low of 5.55 percent in the previous month, according to the Ministry of Commerce.

The core CPI, which excludes raw food and energy prices, rose 3.23 percent year on year, edging up from a 3.22 percent increase a month earlier as production costs were still high.

 For the annual average, the headline CPI increased by 6.08 percent, while the core CPI rose by 2.51 percent.

Thailand’s Gross International Foreign Currency Reserves at 216.6 B USD

The headline seasonally adjusted Manufacturing Purchasing Manger’s Index (PMI) posted 52.5 in December, up from 51.1 in November                                             

                                           

Thailand’s manufacturing output continued to expand in December, but new order volume had slipped, due to the deterioration in economic conditions and consistently high inflation underpinned the decline in new business with international demand falling which will be a drag for the manufacturing side in the coming of months.

Despite all of this, factory managers remained optimistic in December because firms are hopeful that sales can improve as economic conditions recover.

Meanwhile, Inflation is expected to drop down to the Bank of Thailand’s 1% – 3% inflation target in the medium-term horizon for the year 2023.

 The Thai baht Support 33.50 with Resistance of 34.50 leaning towards strength due to the weakening dollar trend and foreign demand for Thai bonds in the recent week.

INDUSTRY

TOURISIM

Hotel Operator Sentiment Index 

The occupancy rate for hotels in Thailand has increased from the previous month due to the year-end High Season and continuing influx of tourists; However, there is a labor shortage which will be problematic for hotels.

 

ENERGY

Oil Fuel Fund Office ( Offo)  

The Oil Fuel Fund Office is going to consider an additional 30-billion-baht loan within March to repay debts incurred by using the fund to subsidize diesel and liquefied petroleum gas (LPG) prices.

Diesel price is capped at 35 baht per liter and the fixed price of LPG used for cooking gas is at 6.12 baht per kilogram to support the cost of living for consumers and businesses.

Thailand, Cambodia to tap gas resources 

The Cabinet on Tuesday had an informal discussion on the realization of join development of petroleum resources estimated at 5 trillion baht with negotiations underway and follow the model of the Thailand-Malaysia Joint Development Area (JDA

BCPG Public Co Ltd (BCPG )

BCPG Invests 9 billion in Petroleum Storage and Wharf Project in Phetchaburi Province by acquiring all issued and paid-up ordinary shares of Asia Link Terminal Co., Ltd., which is a subsidiary of Pan Asia Storage and Terminal Co., Ltd., due to continue with the purchase agreement in the first quarter of 2023 solely financed by internal cash flows.

BANKING

Corporate lending in 2023 to be key driver of loan growth

Due to improving demand from businesses and the strong financial position of large companies corporate lending will be a key contributor to growth which is fuelled by commercial lending.

The non-performing loan (NPL) ratio of the banking sector is expected to be steady in 2023 in the range of 2.65% to 2.75%, compared to 2022’s forecast of 2.55% to 2.8%. The NPL situation is not expected to improve in 2023 due to a fractured recovery in the Thai economy, high levels of household debt, and external uncertainty.

According to the central bank’s data, the commercial banking sector recorded commercial loan growth of 6.1% in the third quarter of 2022, compared with consumer loan growth of 3.9%. The NPL ratio of commercial loans dropped to 2.83% in the third quarter from 2.96% in the second quarter. Also, the bad debt ratio of large companies with credit lines of more than 500 million baht declined to 1.88% in the third quarter, from 2.09% in the previous quarter.

Bank of Ayudhya Public Company Limited (KRUNGSRI)

Krungsri has increased it lending rates by 0.40% per annum, due to a gradual economic recovery in Thailand and increase in interest rates:

 Loan Rate (MLR) is increased by 0.40% to 6.48%

Minimum Overdraft Rate (MOR) is increased by 0.40% to 6.725%

Minimum Retail Rate (MRR) is increased by 0.40% to 6.65%

 

Kiatnakin Phatra Bank (KKPB )

Kiatnakin Phatra Bank (KKPB) joins hands with the Bank for Agriculture and Agricultural Cooperatives (BAAC) to offer a card less withdrawal service through all BAAC ATMs/CDMs nationwide. for the convenience of customers which can withdraw cash without card without fee 10 times per month from today onwards.

CONSTRUCION

UNIQ 

Kiatnakin Phatra Bank (KKPB) joins hands with the Bank for Agriculture and Agricultural Cooperatives (BAAC) to offer a cardless withdrawal service through all BAAC ATMs/CDMs nationwide. for the convenience of customers who can withdraw cash without a card 10 times per month from today onwards.

PROPERTY

ALL

All Inspire has defaulted on debenture interest payment of 10.7m after a lack of liquidity due to insufficient cash flow, of ALL244A debenture. The said debentures have 573 debenture holders and a representative of the debenture holders, namely Bank of Ayudhya (BAY), which the Company will proceed to repay interest on the debentures as soon as possible.

CONSUMER

IPO SUBMISSIONS 

Bangkok Lab & Cosmetic submits IPO filing 120 million shares with the SEC for an initial public offering representing no more than 25% of the total number of issued and paid-up ordinary shares after this public offering and preparing to be listed on the Stock Exchange of Thailand (SET) with KGI Securities (Thailand)) as a financial advisor.

 

Thailand SET Index

  SET index to have a support and resistance of 1660 and 1682 respectively due to the January effect with consumer confidence data to be reported next week.

 

 

 The Investment Analyst Association of Thailand has announced that for the year end the SET should end at around 1741 points in 2023 with the Net profit per share (EPS) of the market in 2023 is expected at an average of 105.34 baht, and increase from the previous survey of 100.36 baht per share.