* Q3 GDP q/q +1.2 pct vs poll +0.9 pct, revised 2.8 pct in
* Q3 GDP y/y +3.0 pct vs poll +3.1 pct, revised 4.4 pct in
* Sees 2012 GDP growth of 5.5 pct, cuts export estimate
* Output/exports fall; consumption, investment help
* Most economists expect no change in policy are next week
(Adds detail, quotes, market reaction)
By Orathai Sriring and Kitiphong Thaichareon
BANGKOK, Nov 19 Thailand's economy grew a
stronger-than-expected 1.2 percent in the third quarter from the
previous three months, reinforcing expectations that the
central bank will keep its policy interest rate on hold until
Third-quarter growth was slower than April-June's revised
2.8 percent, as the weakening global economy hit exports and
factory production. But the latest pace was higher than the 0.9
percent quarterly gain forecast in a Reuters poll.
The Bank of Thailand's policy committee, which surprisingly
cut rates in October, holds its last meeting of the year on Nov.
"We believe that policy rate will remain on an easing bias,
although we do not expect the BOT to cut rate by another 25
basis points until the first half of 2013," said Usara
Wilaipich, senior economist at Standard Chartered Bank in
The National Economic and Social Development Board (NESDB)
on Monday also said that gross domestic product in the third
quarter expanded 3.0 percent from a year earlier, almost
matching the 3.1 percent forecast by the polled economists, and
compared with revised annual growth of 4.4 percent in the second
"Domestic factors were a boost for this quarter as
consumption expanded well, particularly household expenditure as
well as total investment," Arkhom Termpittayapaisith, NESDB
secretary-general, told a news conference.
Overall investment rose 15.5 percent in the third quarter
from a year before while overall consumption was up 6.5 percent,
with household spending up 6 percent year-on-year.
Activity in the first half of the year was buoyed to a large
extent by spending on reconstruction and replacement equipment
after devastating floods in late 2011, but much of that
rebuilding has now been completed.
Exports fell 3 percent in the third quarter from a year
earlier as global demand for Asian goods deteriorated, the
Manufacturing slumped 10.2 percent from a year before, even
as factories restored more capacity after the floods.
Industrial goods account for about 65 percent of exports.
Like in many Southeast Asian nations, strong domestic demand
and tourism have helped shore up Thailand's economy even as
exports and industrial output slumped.
After a strong start to the year, growth across Southeast
Asia has cooled in response to prolonged weakness in demand in
Europe and the United States, and a slowdown in China. Still,
regional economies have remained relatively more resilient than
most developed countries and continue to attract solid foreign
Annual growth in Indonesia in the third quarter,
year-on-year, as exports slowed, but it was still 6.2 percent.
In April-June, growth was 6.4 percent.
For Thailand, the NESDB revised its forecast for 2012
economic growth to 5.5 percent, compared with its previous
5.5-6.0 percent range. Due to the floods, growth in 2011 was
only 0.1 percent.
MORE EASING AHEAD?
In a bid to spur flagging growth, Thailand's central bank's
monetary policy committee (MPC) cut the benchmark interest rate
by a quarter of a point to 2.75 percent on Oct. 17.
At the same time, the central bank cut its GDP growth forecast
for next year to 4.6 percent from 5 percent.
While most economists expect no change in the policy rate
next week, some still think a cut is possible.
"We believe that moderating growth momentum and expectations
of manageable inflation will keep the bias of the majority of
MPC members to support business sentiment," said economist Rahul
Bajoria of Barclays Capital. "We continue to expect the BOT to
cut rates by another 25 bps in the next policy meeting, despite
a likely acceleration in inflation in 2013."
The central bank appeared to have played down inflation
risks, forecasting headline inflation of 3.0 percent for 2012
and down to 2.8 percent for 2013.
The NESDB forecast 2012 headline inflation of 3.0 percent
for 2012 and 2.5-3.5 percent for next year.
The Thai agency forecast GDP growth of 4.5-5.5 percent for
2013. Economists polled by Reuters have predicted growth of 5.3
percent in 2012 and 4.5 percent for 2013..
The NESDB cut its export growth forecast to 5.5 percent from
7.3 percent for this year, but forecast export growth of 12.2
percent for 2013.
(Additional reporting by Sinsiri Tiwutanond and Amy Lefevre;
Editing by Richard Borsuk)