Thailand hopes for 4% growth in US exports this year: DITP
EconJan 22. 2021Department of International Trade Promotion (DITP) director-general Somdet Susomboon
By The Nation
Thailand is targeting a 4 per cent growth in exports to the US this year, Department of International Trade Promotion (DITP) director-general Somdet Susomboon said.
Products with good growth potential include supplementary food, medical products and goods that can be used to work from home.
He added that US President Joe Biden’s trade policy is to not just lower dependence on foreign goods and strengthen domestic industries, but also to lure companies to bring their manufacturing facilities back to the US.
Thailand should closely monitor Biden’s fiscal and monetary policies, which will have an impact on the baht, he said.
Almost 5m workers hit by delayed economic recovery after new Covid wave: BOT
EconJan 22. 2021Chayawadee Chai-Anant, senior director in the BOT economic and policy department. File photo
By The Nation
The new wave of Covid-19 will delay Thailand’s economic recovery and affect 4.7 million workers, a senior official at the Bank of Thailand (BOT) has warned.
Chayawadee Chai-Anant, senior director in the BOT economic and policy department, said though the second wave of infections is not as severe as the first, it would still delay economic recovery to pre-crisis levels – possibly till late next year.
“The recovery will be a K-shaped, not V-shaped, but if government measures are effective, it will be close to a V-shape recovery,” she told a seminar hosted by the World Bank yesterday.
The government has limited lockdowns and restrictions to specific locations after the fresh outbreak in December, while also launching new aid measures that are smaller in scale than in the first virus wave early last year.
The Thai economy showed signs of recovery in the third quarter last year, but the second wave of infections has disrupted that trend.
“Thailand’s economy could return to pre-crisis level in mid-2022, or the recovery may be delayed to late of 2022,” said Chayawadee.
Tourism-related sectors such as restaurants, hotels and transport would feel the brunt of the new outbreak as they have yet to recover from the first wave, she added.
The second wave will hit 4.7 million workers hard, costing either their jobs or reducing their hours along with their income, according to an initial assessment by the central bank and business sectors.
Chayawadee said three key factors needed to be closely monitored.
The first factor is how long the pandemic will last. Second is the effectiveness of government aid measures, and third is how Thailand will open the country to foreign arrivals. Linked with the third factor is the scale of vaccination in the country.
Tourism-related industries are now facing surplus capacity in transport and hotels after tourist arrivals fell to around 7 million, from 40 million before the pandemic. New aid measures must be targeted to reach people in need, she said.
Somprawin Manprasert, chief research economist at Krungsri Bank, said the urban poor are facing the biggest impact from Covid-induced crisis, while high-income groups have been only slightly affected. “The government does not have adequate policy tools to deal with the Covid fallout,” he added.
Pisit Puapan, executive director of the Fiscal Policy Office’s macroeconomic policy bureau, insisted the government has adequate financial resources to deal with economic impact. Thailand’s fiscal position is relatively strong given public debt was only 42 per cent of GDP as recently as 2019, he said. However, he acknowledged that this figure is now climbing, with Thai public debt now close to 60 per cent of GDP.
The government has set sustainable debt-to-GDP at 60 per cent, but that limit could be raised in the future if the country needs to spend more on productive projects, he said.
The World Bank projects the Thai economy will rebound to 4 per cent growth this year and up to 4.7 per cent next year, from an estimated 6.5 per cent contraction last year.
Birgit Hansl, World Bank country manager for Thailand, has called for more women to join the workforce. Thailand should also increase labour productivity, given the country is becoming an ageing society, she said.
Thailand can expect 4-5% growth this year, says Finance Minister
EconJan 22. 2021Finance Minister Arkhom Termpittayapaisit
By The Nation
The Thai economy should expand by 4 to 5 per cent this year, Finance Minister Arkhom Termpittayapaisit said on Thursday at the World Bank’s Thailand Economic Monitor event.
He said the government has launched several economic stimulus measures and hopes the upcoming vaccine will also help revive the economy after the Covid-19 fallout.
Despite this year’s better outlook, the government will continue pushing economic growth by driving digital, eco-friendly as well as health sectors, he said.
The government is also restructuring the taxation system to ensure the country has sustainable revenue, the minister added.
The Cabinet on Tuesday approved the new “RaoChana” (WeWin) cash-handout scheme and another round of “Khon La Khrueng” (Let’s Go Halves) co-payment scheme, aiming to ease the burden on people hit by the new wave of Covid-19 infections.
Arkhom said on Wednesday that the new WeWin scheme and the first two phases of the Let’s Go Halves scheme should boost the economy by 1 per cent.
The Stock Exchange of Thailand (SET) Index closed at 1,513.98 on Thursday, down 1.74 points or 0.11 per cent. Total transactions amounted to Bt91.98 billion with an index high of 1,529.27 and a low of 1,510.80.
In the morning session, Krungsri Securities forecast the SET would move between 1,510 and 1,530 points, supported by investors’ expectation of massive economic stimulus from new US President Joe Biden’s $1.9-trillion “American rescue plan”.
The 10 stocks with the highest trade value today were KBANK, CBG, BBL, PTT, KTC, SCGP, GPSC, CPALL, SCB and HANA.
As of 4.40pm, the price of oil was up to US$0.42 or 0.79 per cent to $52.89 per barrel, while gold rose by $3.30 or 0.18 per cent to $1,869.80 per ounce.
Japan’s Nikkei Index closed at 28,756.86, up 233.60 points or 0.82 per cent.
China’s Shang Hai SE Composite Index closed at 3,621.26, up 38.17 points or 1.07 per cent, while Shenzhen SE Component Index closed at 15,520.60, up 297.24 points or 1.95 per cent.
Hong Kong’s Hang Seng Index closed at 29,927.76, down 34.17 points or 0.12 per cent.
South Korea’s KOSPI Index closed at 3,160.84, up 46.29 points or 1.49 per cent.
Taiwan’s TAIEX Index closed at 16,153.77, up 347.59 points or 2.20 per cent.
The Stock Exchange of Thailand (SET) index opened at 1,526.89 points on Thursday morning, increasing by 11.17 points, or 0.47 per cent, compared to the previous day’s closing.
Krungsri Securities forecast the SET would move between 1,510 and 1,530 points, while the market has been supported by investors’ expectation that the new US administration would come out quickly with an “American rescue plan”.
However, Krungsri Securities said fund inflows from foreign investors would influence the index’s performance.
It advised investors to purchase shares of BBL, PTTGC, Top, IVL, EPG, VNT, SCGP, CBG, Rojna, TVO, STGT, CPF, RCL, PSL, Synex, Com7, XO, Wice, JMT, MTC, Sawad and KCE as these companies were expected to announce growth in turnover. Among them, it said, BBL tended to grow the highest from quarter to quarter.
Krungsri Securities also recommended stocks with high dividends, such as Advanc, Intuch, AP, Siri and WhaUp, and suggested that the drop in new Covid-19 cases in the country was also advantageous to a company such as Erawan Group.
Bitcoin slides below $35,000 as crypto mania loses momentum
EconJan 21. 2021A crane arm lifts a bitcoin sculpture made from scrap metal in Norilsk, Russia, on Dec. 20, 2020. MUST CREDIT: Bloomberg photo by Andrey Rudakov.
By Syndication Washington Post, Bloomberg · Lynn Thomasson
The bitcoin fever is starting to break as worries about a market bubble discourages investors from buying in.
Prices for the largest cryptocurrency dipped as much as 8.4% on Wednesday and traded below $34,000. Ever since the market shot through all-time highs in early January, bitcoin has been beset by volatility and skepticism that the run-up has been excessive.
Analysts have pointed to $40,000 as the key level that bitcoin needs to surpass in order to draw fresh money from investors riding cryptocurrency momentum. They argue that recent gains could prove fleeting if the rally stalls and traders looking for quick returns shift their money elsewhere.
“Many cryptocurrency traders are diversifying into other coins in fear that bitcoin could see another collapse if $41,500 is not reached sometime soon,” said Edward Moya, senior market analyst at Oanda Corp.
There are also fears from Wall Street pros that bitcoin’s 400% rally in the past year makes it too dangerous for them to jump in. In Bank of America’s monthly survey, fund managers called bitcoin the world’s most crowded trade — the first time it’s held that title since 2017.
By Syndication Washington Post, Bloomberg · Adam Haigh, Vildana Hajric · BUSINESS, US-GLOBAL-MARKETS
U.S. stocks rallied to all-time highs as investors grew optimistic that recent federal spending will revive growth and bolster corporate earnings. Treasuries were little changed while the dollar weakened.
The Nasdaq 100 Index jumped more than 2% and the S&P 500 Index posted the best first-day reaction to a newly elected president’s inauguration since Jan. 20 became the official start in 1937. Netflix Inc. surged more than 17% after a jump in subscribers. Chipmaker ASML Holding NV rallied on solid results. Morgan Stanley gained after reporting record full-year results.
Investors looked past a fresh stumble in the rollout of vaccines and elevated infection rates, and eyed the promise of more stimulus and an expanded federal effort to get shots to more Americans quickly under President Joe Biden.
“If stimulus happens at the same time that people get vaccinated, the optimism can’t help but build,” said Keith Buchanan, a portfolio manager for GLOBALT Investments in Atlanta. “It’s a fairly safe bet there will be another stimulus package with more direct payments to consumers and individuals and more help for small businesses..”
Investors are counting on more spending to help propel economic growth under Biden, who is planning a flurry of executive orders on his first day. Still, it won’t be all smooth sailing, with Janet Yellen encountering early Republican resistance to Biden’s relief plan in her confirmation hearing to become treasury secretary.
On the virus front, Germany suffered record daily deaths and a study on the South African variant raised concern about the efficacy of vaccines.
Elsewhere, crude oil edged higher and gold traded touched an almost two-week high. In Asia, Chinese firms trading in Hong Kong saw the bulk of gains, and the Hang Seng Index approached the 30,000 level. Alibaba Group Holding Ltd. rallied after billionaire Jack Ma resurfaced from months out of public view amid escalating scrutiny over his internet empire.
Here are the main moves in markets:
Stocks
The S&P 500 Index increased 1.4% as of 4 p.m. EST, the highest on record with the largest climb in almost two weeks.
The Nasdaq Composite Index gained 2% to the highest on record.
The Nasdaq 100 Index rose 2.3% to an all-time high.
The Stoxx Europe 600 Index increased 0.7% to 410.78.
Currencies
The Bloomberg Dollar Spot Index declined 0.2%.
The euro fell 0.2% to $1.2101.
The British pound rose 0.1% to $1.3644.
The Japanese yen appreciated 0.3% to 103.57 per dollar, the strongest in two weeks on the largest gain in more than a week.
Bonds
The yield on 10-year Treasurys lost one basis point to 1.085%.
The two-year rate fell to 0.13%.
Germany’s 10-year yield dipped less than one basis point to -0.53%.
Commodities
West Texas Intermediate crude gained 0.6% to $53.29 a barrel.
Gold strengthened 1.4% to $1,865.95 an ounce, the highest in almost two weeks on the biggest jump in more than two weeks.
Thai govt keen to push Dawei SEZ development despite Italian-Thai setback
EconJan 21. 2021NESDC secretary general Danucha Pichayanan
By The Nation
Prime Minister Prayut Chan-o-cha has been handed a detailed summary of Myanmar’s cancellation of contracts with the Italian-Thai Development Company and partners to develop the first phase of the country’s Dawei special economic zone (SEZ) and deep-sea port.
The National Economic and Social Economic Council (NESDC)’s summary includes details of infrastructure projects in the zone, said NESDC secretary general Danucha Pichayanan.
He added that the Thai government would seek mechanisms to help Italian-Thai, and was keen to push forward Dawei’s development. The Dawei SEZ and seaport will open a trade route to the Indian Ocean for Thai exports.
Stock market regulators in Hong Kong and Thailand on Wednesday clinched a memorandum of understanding (MoU) on Mutual Recognition of Funds (MRF), to allow distribution of funds in each other’s market through a streamlined process.
The MoU between Hong Kong’s Securities and Futures Commission (SFC) and the Securities and Exchange Commission of Thailand (SEC) establishes a framework for exchange of information, regular dialogue as well as regulatory cooperation for the cross-border offering of eligible Hong Kong and Thai funds.
The two regulators also agreed to speed up the approval process of a local feeder fund investing in an MRF-eligible Thai or Hong Kong master fund, and to clarify how they can operate in a streamlined manner.
“This new cooperation framework signifies a major expansion of our MRF network in Asia. It opens up new business opportunities for fund management firms and broadens cross-border investment channels and choices for investors,” said Ashley Alder, CEO of the Hong Kong regulator.
SEC secretary-general Ruenvadee Suwanmongkol hailed the bilateral agreement as another milestone in Hong Kong-Thailand cooperation, following the MoU on Strengthening of Economic Relations signed in 2019.
“The Mutual Recognition of Funds initiative will deepen economic cooperation between Hong Kong and Thailand. More importantly, it will promote the competitiveness of local intermediaries in the international arena while enriching the types of fund products offered to investors,” Ruenvadee said.
The cooperation arrangements set out in the MoU come into effect on Wednesday (January 20), save for the mutual recognition of funds scheme which the regulators said should be implemented within six to 12 months.
The Stock Exchange of Thailand (SET) Index closed at 1,515.72 on Wednesday, down 6.87 points or 0.45 per cent. Total transactions amounted to Bt93.55 billion with an index high of 1,529.50 and a low of 1,511.41.
In the morning session, an analyst at Krungsri Securities forecast the index would fluctuate between 1,515 and 1,535 points amid the incoming US administration’s $1.9-trillion stimulus package and mass buy-ups of shares in Thai companies whose fourth-quarter turnover is expected to improve.
“However, the SET will be under pressure from its tight valuation and decline in foreign fund inflows,” he said.
The 10 stocks with the highest trade value today were PTT, CBG, KTC, GPSC, BANPU, PTTEP, CPF, SCGP, KBANK and CPALL.
As of 4.30pm, the price of oil rose by US$0.51 or 0.96 per cent to $53.49 per barrel, while gold rose by $16.40 or 0.89 per cent to $1,856.60 per ounce.
Other Asian indices were mixed:
Japan’s Nikkei Index closed at 28,523.26, down 110.20 points or 0.38 per cent.
China’s Shang Hai SE Composite Index closed at 3,583.09, up 16.71 points or 0.47 per cent, while Shenzhen SE Component Index closed at 15,223.36, up 219.37 points or 1.46 per cent.
Hong Kong’s Hang Seng Index closed at 29,962.47, up 320.19 points or 1.08 per cent.
South Korea’s KOSPI Index closed at 3,114.55, up 21.89 points or 0.71 per cent.
Taiwan’s TAIEX Index closed at 15,806.18, down 71.19 points or 0.45 per cent.
Department of International Trade Promotion (DITP) director-general Somdet Susomboon
Chayawadee Chai-Anant, senior director in the BOT economic and policy department. File photo
Finance Minister Arkhom Termpittayapaisit
A crane arm lifts a bitcoin sculpture made from scrap metal in Norilsk, Russia, on Dec. 20, 2020. MUST CREDIT: Bloomberg photo by Andrey Rudakov.
NESDC secretary general Danucha Pichayanan
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