BANGKOK: Thailand's economy has passed its lowest point and is expected to contract less than previously expected this year due to a recovery in consumption, senior officials said.

"We can say that our lowest point was in the second quarter," Danucha Pichayanan, head of the National Economic and Social Development Council, told business executives at a dinner talk on Wednesday.

A recovery in agricultural goods prices also helped consumption, he said.

Official third-quarter gross domestic product (GDP) data is due to be released on Nov 16.

"GDP will be negative this year, but less so than expected due to a recovery in consumption," Finance Minister Arkhom Termpittayapaisith told reporters earlier. He said revenue was coming from exports while the country remained closed to tourism, adding that "foreign exchange policy should support exporters."

The finance ministry has forecast an economic contraction of 7.7% this year due to the impact of the coronavirus pandemic.

Meanwhile, the baht hit 30.19 per US dollar earlier, a 10-month high.

Thailand has kept coronavirus infections low with 3,847 cases and 60 deaths, but its economy has taken a hit from a ban on foreign visitors since April.

The government predicts just 6.7 million foreign visitors this year after a record 39.8 million in 2019, whose spending made up about 11.4% of GDP, or 1.93 trillion baht (RM263.3 billion).

Southeast Asia's second-largest economy contracted 12.2% in the second quarter year-on-year, the sharpest fall in 22 years, as the pandemic pummelled tourism and consumption.

Our fiscal position is strong but could face some challenges next year from taxpaying businesses, and so the ministry is planning to adjust its tax structure to increase collection and support targeted industries, Arkhom said.

Thai banks are in a strong position, with ample liquidity, central bank governor Sethaput Suthiwart-Narueput said.

"This crisis is more severe than previous ones, but there is stability. It will take a long time to solve and measures have to be precise and not cast a wide net," he said, highlighting unemployment brought on from the collapse of the tourism and mounting household debt. – Reuters