Market Roundup 28 June 2023

1) Thai stock market overview

Thailand’s SET Index closed at 1,466.93 points, decreased 11.17 points or 0.76% with a trading value of 48 billion baht. The analyst stated that the Thai stock market continued to decline to a record low in two years as investors lost confidence in the market. The banking sector was heavily sold, causing the sentiment to get even worse when combined with an uncertainty in political issues. Global factors also did not help support the market.

The analyst expected the SET Index to continue its downtrend until political issues eased.


2) World Bank upgrades Thailand’s 2023 GDP growth as global economy recovers and tourists return

The World Bank on Wednesday lifted its growth forecast for Thailand’s economy from 3.6% to 3.9% for this year due to higher-than-expected demand from China, Europe, and the United States, as well as private consumption growth and a revival in tourism.

Last year, the gross domestic product of Thailand grew by 2.6%.

According to the World Bank’s semi-annual Thailand Economic Monitor, growth is predicted to slow to 3.6% in 2024 and to 3.4% in 2025, with tourism and private consumption being the main drivers of growth amid slowing foreign demand.

As for inflation, the World Bank anticipates that it will drop to 2% in 2023 thanks to falling global energy prices. However, excluding volatile food and energy prices, core inflation has remained higher than it was prior to the COVID-19 pandemic.

The positive tourism forecast has been bolstered by the return of tourists, especially Chinese travelers. The World Bank estimates foreign arrivals to exceed 28.5 million, or 84% of the 2019 level, and return to pre-pandemic levels by mid-2024.


3) Australia’s inflation cools to 13-month low in a signal for rate pause in July

Australia’s consumer prices slowed to a 13-month low in May with the help of declining fuel prices.

Inflation in May rose 5.6% from a year earlier, according to the released data from the Australian Bureau of Statistics on Wednesday that beat the market forecast for a rise of 6.1%. This marked the slowest increase since April last year and down from 6.8% in April 2023.

Core inflation rose 6.1% from last year, its seven-month low and also at a slower pace compared to 6.7% in April. This could be a sign that the central bank might not have to raise rates again in July.

The market was quick to respond to the data as the Australian dollar fell 0.8% to $0.6632. The probability for a hike in July is now at 30% and the peak rate has been lowered to 4.35% instead of 4.6%.