Economists noted its forecast for headline inflation this year was cut to 3.8 per cent from 3.9 per cent even though supply shortages and transport disruption could force prices up in the final quarter. The BOT left its benchmark interest rate unchanged at 3.5 per cent at a meeting last week, pausing after a year of tightening while it assessed the threats to the economy. Its next scheduled meeting, the last of the year, is on November 30.
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“A drop in industrial production to the tune of 15-20 percent month-on-month cannot be ruled out,” said Rahul Bajoria, an economist at Barclays Capital, Singapore. “I think a sharp recovery [for operations and the economy] is in the making in the first quarter of next year...The risks of a rate cut at the November 30 meeting are rising.”
The Thai baht closed at 30.50 per US dollar versus 30.52 in early trade. The benchmark stock market index was up 2.5 percent, driven up earlier by news on the eurozone deal.
Thailand’s worst flooding in half a century, caused in part by unusually heavy monsoon rain, has killed 377 people since mid-July and disrupted the lives of nearly 2.2 million, until now mostly in the north and central provinces.
Bangkok, the low-lying capital city of at least 12m that accounts for 41 per cent of Thailand’s $319 billion economy, is in danger from run-off water from the north coinciding with the high tide on the Chao Phraya river, already at a record high level.
Television footage showed bumper-to-bumper traffic leaving the capital and the main airport’s departure lounges packed, but the traffic department said it could not put an exact figure on the size of the exodus because much of its monitoring equipment was under water. Prime minister Yingluck Shinawatra’s government declared a five-day holiday from Thursday to allow people to leave.
Ms Yingluck said she was considering a proposal to dig channels into some roads in eastern Bangkok to drain water into the Gulf of Thailand, an idea backed by the chairman of the Thailand unit of Toyota Motor Corp whose factories have been badly flooded.
“We need to look into several details on whether it works,” Yingluck told reporters.
The meteorological department warned residents living along the Chao Phraya river they could face rising waters. On Friday morning, on a street in front of the Grand Palace normally bustling with tourists, a two-metre (6 1/2-ft) snake was caught by a motorcycle taxi driver. Residents have also had to contend with crocodiles escaping from flooded farms. While many of the inner-city streets of Bangkok remained dry, the suburbs continued to struggle.
In the riverside shantytown of Bang Phlad, small wooden homes were knee-deep in foul-smelling water with rubbish floating on the surface. Residents carried belongings above their heads, struggling against the current of water pumped back out to the river.
The economic toll continued to pile up across Thailand, Southeast Asia’s biggest auto production hub and a major base for multinational companies, many of which face supply and production disruptions after the floods shuttered at least seven industrial estates north of Bangkok. Daihatsu Motor Co, which makes mini-vehicles for Toyota Motor Corp, said it would reduce work to produce Toyota-badged cars at two Japanese factories next week due to a shortage of parts from Thailand.
But insured losses are likely to be at a manageable level and will not trigger widespread solvency problems, said credit-ratings agency Fitch Ratings.
The defence ministry said 50,000 armed forces personnel were standing by with 1,000 boats and 1,000 vehicles to help evacuate people. A government crisis centre said there would soon be evacuation centres in eight provinces that could take in between 100,000 and 200,000 displaced people.
The government also revised up its estimated damage to paddy crops to around 6m tonnes from the current 2011-12 crop, a 50 percent jump from an initial estimate of 4m.
“The 6 million tonnes damage is just an initial estimate. We need to conduct a survey again after flood water recedes,” Apichart Jongsakul, head of the office of agriculture economy, said. The worsening flood situation could cut Thai production to 19 million tonnes of paddy, he said, nearly a quarter down from the previous forecast of 25 million. Thailand, the world’s biggest rice exporter, has seen about 1.6 million hectares (3.8 million acres) of farmland inundated, forcing the government to cut its estimate for this year’s main crop by 24 percent.
The Thai baht closed at 30.50 per US dollar versus 30.52 in early trade. The benchmark stock market index was up 2.5 percent, driven up earlier by news on the eurozone deal.
Thailand’s worst flooding in half a century, caused in part by unusually heavy monsoon rain, has killed 377 people since mid-July and disrupted the lives of nearly 2.2 million, until now mostly in the north and central provinces.
Bangkok, the low-lying capital city of at least 12m that accounts for 41 per cent of Thailand’s $319 billion economy, is in danger from run-off water from the north coinciding with the high tide on the Chao Phraya river, already at a record high level.
Television footage showed bumper-to-bumper traffic leaving the capital and the main airport’s departure lounges packed, but the traffic department said it could not put an exact figure on the size of the exodus because much of its monitoring equipment was under water. Prime minister Yingluck Shinawatra’s government declared a five-day holiday from Thursday to allow people to leave.
Ms Yingluck said she was considering a proposal to dig channels into some roads in eastern Bangkok to drain water into the Gulf of Thailand, an idea backed by the chairman of the Thailand unit of Toyota Motor Corp whose factories have been badly flooded.
“We need to look into several details on whether it works,” Yingluck told reporters.
The meteorological department warned residents living along the Chao Phraya river they could face rising waters. On Friday morning, on a street in front of the Grand Palace normally bustling with tourists, a two-metre (6 1/2-ft) snake was caught by a motorcycle taxi driver. Residents have also had to contend with crocodiles escaping from flooded farms. While many of the inner-city streets of Bangkok remained dry, the suburbs continued to struggle.
In the riverside shantytown of Bang Phlad, small wooden homes were knee-deep in foul-smelling water with rubbish floating on the surface. Residents carried belongings above their heads, struggling against the current of water pumped back out to the river.
The economic toll continued to pile up across Thailand, Southeast Asia’s biggest auto production hub and a major base for multinational companies, many of which face supply and production disruptions after the floods shuttered at least seven industrial estates north of Bangkok. Daihatsu Motor Co, which makes mini-vehicles for Toyota Motor Corp, said it would reduce work to produce Toyota-badged cars at two Japanese factories next week due to a shortage of parts from Thailand.
But insured losses are likely to be at a manageable level and will not trigger widespread solvency problems, said credit-ratings agency Fitch Ratings.
The defence ministry said 50,000 armed forces personnel were standing by with 1,000 boats and 1,000 vehicles to help evacuate people. A government crisis centre said there would soon be evacuation centres in eight provinces that could take in between 100,000 and 200,000 displaced people.
The government also revised up its estimated damage to paddy crops to around 6m tonnes from the current 2011-12 crop, a 50 percent jump from an initial estimate of 4m.
“The 6 million tonnes damage is just an initial estimate. We need to conduct a survey again after flood water recedes,” Apichart Jongsakul, head of the office of agriculture economy, said. The worsening flood situation could cut Thai production to 19 million tonnes of paddy, he said, nearly a quarter down from the previous forecast of 25 million. Thailand, the world’s biggest rice exporter, has seen about 1.6 million hectares (3.8 million acres) of farmland inundated, forcing the government to cut its estimate for this year’s main crop by 24 percent.
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