Thailand's Economic Growth Slows Even as It Beats Estimate.

Thailand's economic growth in the first quarter of the year was slower than expected, putting pressure on the central bank to lower borrowing costs to aid recovery. Gross domestic product (GDP) rose 1.5% from a year earlier, surpassing the median estimate of 0.8% in a Bloomberg survey. However, the economy expanded 1.1% quarter-on-quarter, compared to a median estimate of 0.6% growth. The slower economic growth is likely to support the case for an interest-rate cut in the Bank of Thailand's next meeting in June. The government and central bank tensions have cooled, with the finance minister stating that lending and liquidity are more important than borrowing costs. The central bank's policy rate has remained at 2.5% since September, despite negative consumer prices and stuttering GDP growth. Inflation increased in April, marking the first gain in seven months. The second half of the year is expected to see an acceleration in economic growth due to public spending and a $14 billion cash handout to boost consumption. However, critics have warned that this could lead to inflation and hinder fiscal consolidation. [Extracted from the article]