Thai economy faces stagflation due to surging price hikes: economist hinh anh 1A woman shops at a market in Bangkok (Photo:
Bangkok (VNA) – Thailand's economy has gone into stagflation because of a fragile recovery and surging price hikes, according to an economist at the Economic Intelligence Centre (EIC), a research unit under the Siam Commercial Bank (SCB).

The EIC downgraded its 2022 economic growth forecast for Thailand to 2.7 percent from 3.2 percent, which was attributed to the Russia - Ukraine war that has led to soaring energy and commodity prices.

Local media cited Yunyong Thaicharoen, SCB's chief wholesale banking officer and an economist at the EIC, as saying that Thailand's annual average headline inflation rate is expected to jump to a 14-year high of 4.9 percent this year, rising significantly from a previous forecast of 1.6 percent.

For Thailand, the higher inflation rate will cause domestic spending to recover slower than EIC previously forecast, said the centre.

Yunyong said given the weak Thai economic rebound amid several external risk factors, the country's recovery to pre-pandemic levels will be delayed to the third quarter of next year.

He added that the Russia-Ukraine conflict will result in lower numbers of Russian and European tourists visiting Thailand, though this will partially be offset by Asian and ASEAN travellers.

The EIC slightly reduced its foreign tourist arrival projection for this year to 5.7 million from 5.9 million, providing the country with annual tourism income of 300 billion THB (about 9 billion USD)./.