Thailand’s SET Index closed at 1,401.11 points, increased 25.53 points or 1.86% with a trading value of 48.38 billion baht. The analyst stated that the Thai stock market rebounded following the rise in every segment. The short-term supporting factors included the announcement of Outstanding Short Positions from the Stock Exchange of Thailand (SET), sending positive sentiment to the market, while the resolution regarding economic stimulus measures from the cabinet meeting also supported the market.
The analyst expected the market to trade sideways tomorrow, while investors awaited the clarification on the digital wallet scheme from the Monetary Policy Committee.
Investors, analysts and economists are divided on the upcoming Bank of Thailand’s meeting next week over whether the central bank will continue to maintain the interest rates or cut them by a quarter basis point.
The Bank of Thailand started raising rates in 2022 during the Covid crisis that saw inflation surged to nearly 8%. Last time the kingdom saw inflation this high was during the 2008 financial crisis.
After a peak in August 2022, inflation in Thailand trended downward, while the Bank of Thailand gradually raised its key policy rates to 2.50% in September 2023 and stayed there.
However, high borrowing costs started to impact businesses, especially SMEs and consumers.
It was projected at the beginning of the year that the Bank of Thailand would not cut its benchmark this year, but that forecast has been changing in February and March as some economists and analysts were expecting to see a cut or two in 2024.
Barclays, Standard Chartered and DBS Group expect two cuts in the second quarter and maintain at that level throughout the year. Goldman Sachs expects one cut in the second and another one in the third quarter. Meanwhile, Nomura Securities is so dovish that it expects a full percentage cut by the end of this year.
Retail sales in the UK saw a significant increase last month, mainly driven by higher food spending due to an early Easter, according to the British Retail Consortium. Despite this boost, overall sales growth remained subdued, impacted by dampened demand for other goods caused by wet weather. The UK economy, which experienced a shallow recession in the second half of last year, is showing signs of sluggish growth in the first quarter of this year, supported by easing inflation pressures.
The British Retail Consortium reported a 3.5% year-on-year increase in total retail spending in March, a notable rise from the 1.1% growth seen in February. This growth surpassed the pace of consumer price inflation for the first time in over two years. However, it is important to note that the figures are not seasonally adjusted, with the early Easter shift playing a significant role in the boost to food sales.
While food sales surged by 6.8% compared to the previous year in the first quarter, non-food spending witnessed a decline of 1.9%. The adverse impact of wet weather in March was evident in reduced sales of garden furniture, home improvement goods, clothing, and footwear.
Barclays’ data revealed that consumer spending growth, a broader metric than retail sales, remained at 1.9% in March, matching its lowest annual rate since September 2022. Despite factors like the release of “Dune 2” and events like St Patrick’s Day and rugby matches boosting spending, the overall growth rate remained subdued. Retail experts are hopeful for an uptick in demand in the upcoming months, driven by better weather, lower energy prices, higher wage growth, and anticipated events like Taylor Swift concerts and the Olympics.
