Real estate market to fire up with the country’s full reopening

• According to the National Economic and Social
Development Council (NESDC), the Gross Domestic
Product increased by 2.5 per cent in Q2 2022
compared to a 2.3 per cent increase in Q1 2022. The
expansion was from an acceleration of growth in the
services sector, resulting from the ease of Covid-19
restrictions and the continuous implementation of
the government’s stimulus measures for tourism that
helped drive up the number of foreign tourist arrivals
and domestic tourism.

• Private final consumption expenditure increased by
6.9 per cent, accelerating from a 3.5 per cent increase
in the previous quarter. Spending on semi-durable
goods continued to expand. Spending on durable and
non-durable goods rose in Q2 by 3.4 per cent and 2.7
per cent, respectively. The slowdown in spending on
non-durable goods was mainly from food and nonfood
items.

• Government final consumption expenditure increased
by 2.4 per cent, slowing down from a 7.2 per cent
increase in Q1. The deceleration stems from the lower
compensation of employees and purchases of goods
and services with expansions of 1.3 per cent and 0.1
per cent, respectively. On the contrary, social transfers
in kind expanded by 17.0 per cent compared to an
increase of 87.6 per cent in Q1.

• Private investment increased by 2.3 per cent,
decelerating from a 2.9 per cent expansion in Q1,
attributed to a slowdown in machinery investment and
contraction in construction. Public investment continued
recording a decrease of 9.0 per cent, compared to a 4.7
per cent decrease in Q1, stemming from a decline in
construction and machinery investment.

• Exports of goods and services increased by 8.5 per cent,
decelerating from a 12.1 per cent increase in Q1 2022.

• The consumer price index (CPI) rose by 6.5 per cent in
Q2 2022, higher than the 4.7 per cent recorded in Q1
due to the higher cost of goods.

• According to the National Economic and Social
Development Council (NESDC), the Thai economy is
forecasted to expand in the range of 2.7 – 3.2 per cent
in 2022, mainly supported by 1) the improvement in
domestic demand, 2) the recovery of the tourism sector,
and 3) the continual expansion in the export of goods.

• The central bank raised its key interest rate for the
first time in nearly four years by 25 basis points
from 0.50 per cent to 0.75 per cent, effective in July
2022, to wrestle control over surging inflation as
the economic recovery gains momentum. Given
the current inflation rate surge, the central bank is
prioritizing inflation and is committed to keeping the
inflation target for the medium to long term through
monetary policy.

• The cabinet approved an extension of the “Khon La
Khrueng” co-payment scheme to help alleviate the
hardship of people affected by the higher living costs
amid high inflation. The new measures comprise the
fifth phase of the Khon La Khrueng scheme and 200-
baht cash handouts to vulnerable people who require
special assistance, such as the elderly, the disabled,
bed-ridden patients, those without smartphones, and
low-income earners who hold state welfare cards.
However, the subsidies under the fifth phase of the copayment
scheme lowered to 800 baht per person per
month, compared to 1,200 baht in the previous phase.
The new measures will run for two months, starting 1
September 2022.

• According to the University of Thai Chamber of
Commerce (UTCC), consumer confidence picked up
for the third straight month in August, bolstered by
improved economic activity following government
support measures and the ease of Covid-19 curbs.
The consumer confidence index rose to 43.7 in August
from 42.4 in July and 41.6 in June. Consumers felt the
economic condition has started to pick up slightly.
The recovering consumer sentiment also stemmed
from the latest economic growth forecast by the
Fiscal Policy Office (FPO), lower retail oil prices, and
a recovery in both the tourism sector and domestic
consumption. Consumers have returned to active
spending in the late third quarter of this year as the
economy gains steam.

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