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After a devastating flood last fall, Thailand’s economy rebounded 11% in the first quarter compared with the previous three months.
Analysts are pointing to strong growth for the full year since quake-recovery efforts and government stimulus have led to a hike in consumption and investment.
The 11% growth was logged after a contraction of 10.8% in the fourth quarter of last year after a flood decimated Thailand’s key industrial zones for autos and electronics.
Thailand’s GDP for the first quarter of 2012 edged up only 0.3% from a year ago, according to data from its National Economic and Social Development Board (NESDB). NESDB forecasted inflation for the year to stand at 3.5% to 4% and the economy to grow by 5.5% to 6.5% this year, which remains unchanged from its earlier forecast made in February. Meanwhile, Thailand’s central bank upped its forecast for 2012 growth to 6% from 5.7% this month.
Analysts predict the robust uptake in the first quarter has increased the chances of an interest rate hike in 2012. “For the time being, we maintain our call that the first hike of 25 bps will occur in [first quarter of] 2013,” RBS’ Erik Lueth noted.