BANGKOK (The Nation/Asia News Network): The Thai Chamber of Commerce is concerned about rising interest rates, which are impacting the global money and capital markets and having a negative effect on Thai exports as the purchasing power of US consumers has declined.
Thai exports as the purchasing power of US consumers has declined.
Wisit Limluecha, vice chairman of the Thai Chamber of Commerce and Chairman of the Processed Food and Future Food Committee (PFC) of the Federation of Thai Industries (FTI), said the US Senate’s approval of the draft bill to lift the US debt ceiling allows the US government the opportunity to borrow money and to introduce more economic stimulus measures if necessary.
It remains to be seen whether the US Federal Reserve will again raise interest rates at its meeting. Doing so would impact the financial markets, capital markets, and the global economy.
Previously, the Fed started to ease the interest rate adjustment, which relieved concerns in the financial and capital markets and led to increased trading activities.
The recent increase in interest rates has resulted in a downturn in consumer purchasing power in the US and this has affected imported goods that are essential for daily life, with consumers veering away from replacing big-ticket items.
During the Covid years, Thailand exported a significant amount of electrical appliances and computer-related components to the US, long considered an important trading partner, but April saw a worrying decline in exports, with a negative value of US$3.23 billion, a decrease of 9.6%, Visith said.
Arada Fuengthong, Deputy Director-General of the Department of International Trade Promotion, said that the department has been monitoring the US public debt ceiling, which might well force the
The US still has a high debt level and related interest obligations and had it defaulted on its debt, even for a single day, the repercussions on the global financial and capital markets would have been severe.
While that has been avoided, economic problems, inflation, and high-interest rates in the US will significantly impact domestic purchases and undoubtedly lead to a continuing decline in Thai exports.