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  1. #1
    Mid
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    Fitch hints early downgrade of Thailand's sovereign rating

    Fitch hints early downgrade of Thailand's sovereign rating



    BANGKOK, Sept 11 (TNA) – Fitch Ratings, the internationally renowned credit rating agency, said it might need to downgrade Thailand's sovereign rating ahead of schedule if the current political turmoil continues unabated.

    Speaking at an annual seminar of Fitch Ratings (Thailand) Limited, James McCormack, Head of Asia Sovereigns, said the Thai economic fundamentals remain strong.

    However, he conceded, the Thai economy is likely to slow down because consumer and investor confidence had eroded and local consumption had declined continuously with high inflation rates undermining purchasing power.

    Fitch projected the Thai economy would grow only 4.6 per cent this year, down from the 5 per cent forecast earlier.

    He said the current political disturbances had a direct impact on economic conditions and a negative effect on Thailand's sovereign outlook.

    Mr. McCormack indicated that political factors had extensively affected economic policy, and directly impacted investment and spending.

    More importantly, there is no 'light at the end of the tunnel' for the ongoing political standoff.

    Should the problem continue to be unresolved, he said, it would negatively impact on the country's sovereign position.

    "Now, Fitch continues to monitor the situation and will not yet adjust Thailand's sovereign rating because its position is somewhat resistant to the political turmoil.

    "But if the political disturbance drags on for long or turns violent, Fitch may need to downgrade the country's sovereign rating, which is affirmed at BBB+ at present, before a normal rating adjustment is made early next year," he said. (TNA)

    enews.mcot.net


    unfortunate timing for the BOT .............


    Bank of Thailand confident economy will adjust to political uncertainties

    BANGKOK, Sept 11 (TNA) – Bank of Thailand (BoT) Deputy Governor Bandid Nijathaworn on Wednesday expressed confidence the Thai economy would be able to adjust to Thailand's ongoing political uncertainties.

    He said the political turmoil had caused economic uncertainties for a certain period, but that the economy had already absorbed the negative impacts to a certain extent.

    The political uncertainties, if persistent, would affect investor confidence in the long term.

    However, should the uncertainties end quickly, he said, it would give the economy a boost and make spending and investment recover.

    Mr. Bandid said the current world situation needs to be closely monitored, as global economic and financial conditions had recently weakened, as witnessed by a continued decline in stock prices.

    He conceded that the increased global financial and economic volatility might affect Thailand's economic recovery, export growth, liquidity in the system, and capital movement.(TNA)

    enews.mcot.net

  2. #2
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    Quote Originally Posted by Mid
    However, should the uncertainties end quickly, he said, it would give the economy a boost and make spending and investment recover.
    I think this guy needs to learn to appreciate that the ongoing turmoil here shapes the long term opinion of investors who generally will look at the bigger picture when considering a sizable investment.
    It not like huge multi national companies are waiting at the docks for a coup to finish so they can move in a build a factory. No, they look longer term and the current nonsense in Thailand must be extremely damaging for long term viability of Thailand as a sensible location for any large investments.

  3. #3
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    "...Now, Fitch continues to monitor the situation and will not yet adjust Thailand's sovereign rating because its position is somewhat resistant to the political turmoil..."

    In other words, we'll bend over backwards not to compound their woes because we farangs need LoS far more than the Thai's realise they need us.

  4. #4
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    Fitch, MBIA, Ambak et all have been guilty of issuing AAA ratings on companies that didnt warrant them. Thailand is no exception. As long as these ratings are paid for, as opposed to issued impartially, its been proven they aint worth shit!

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