31-8-2023 (BANGKOK) Thailand recorded a current account deficit of US$0.4 billion in July, a significant decrease from the surplus of $1.4 billion recorded in the previous month, the Bank of Thailand (BoT) announced on Thursday.
According to the BoT, exports, a key driver of growth for the Thai economy, dropped by 5.5% year-on-year in July. Despite this decline, the country’s economic recovery remained on track, with the tourism sector expanding on the back of higher foreign arrivals.
Sakkapop Panyanukul, a senior director at the BoT, stated that going forward, economic activity in Thailand would rely heavily on the recovery of the tourism sector. However, there are still some risks associated with exports.
The BoT plans to monitor a slowdown in trading partners, policies of the incoming government, and the impact of El Nino weather patterns on food prices for the remainder of the year.
The narrowing of the current account deficit in July was largely due to a decrease in the trade deficit, which stood at $0.8 billion, compared to a deficit of $1.1 billion in June. However, the services surplus decreased slightly to $0.4 billion in July, from $0.5 billion in June.
The BoT also reported that foreign exchange reserves increased to $222.6 billion in July, up from $219.7 billion in the previous month. This represents an increase of 1.3% year-on-year.
Overall, Thailand’s economy continues to show resilience, with the tourism sector being a key driver of growth. However, the BoT remains cautious about the outlook for exports, given the current global economic uncertainty.
The central bank is closely monitoring the situation and is prepared to take appropriate measures to ensure the continued stability and growth of the Thai economy.
