Abstract
SCB EIC projects a 2.6% global economic expansion in 2024, with positive momentum in Q4/2023 and early 2024. The service sector is growing, and manufacturing is rebounding. Central banks will adjust monetary policies, with the US likely cutting rates and Japan raising them. Thailand’s economic growth forecast is 2.7%, down from 3%, with challenges in public spending, inventory accumulation, and manufacturing competitiveness. Inflation may rise due to global supply chain disruptions, but the Thai baht is expected to stabilize. Thailand needs to address structural issues in the manufacturing sector to boost long-term economic potential.
Summary
Global Economic Outlook for 2024
The global economy is expected to expand by 2.6% in 2024, showing improved momentum from Q4/2023 and promising economic activities in early 2024. The service sector and manufacturing activities are showing signs of growth and rebound, supported by more favorable global trade conditions and easing inflation pressures. However, challenges such as high interest rates, geopolitical tensions, and supply chain disruptions remain.
Expected Monetary Policy Changes in Major Economies
Central banks in major economies are likely to pivot their monetary policy directions in Q2/2024. The US Federal Reserve, European Central Bank, and Bank of England are expected to adjust policy rates, with the Bank of Japan potentially hiking rates. The People’s Bank of China is likely to maintain an accommodative stance to support its economy.
Thai Economic Outlook for 2024
Despite a revised growth forecast of 2.7%, Thailand’s economy is expected to rebound supported by tourism, robust service sector performance, and demand-driven activities. Challenges include public spending contraction, high inventory accumulation, and structural issues in the manufacturing sector. Thailand’s neutral rate is expected to decrease, prompting rate cuts to support the economy and alleviate debt burdens. To enhance competitiveness and resilience, the manufacturing sector needs to adapt to sustainability trends and modernize supply chain management.
Source : Outlook Quarter 1/2024
