The Bank of Thailand will further revise its estimates of economic damage from the floods to take into account factors such as disruptions to the services sector and commercial activity in Bangkok, says Suchada Kirakul, deputy governor for monetary stability.
The central bank on Oct 19 estimated losses of 120 billion baht in industrial output from floods that damaged industrial estates and severely inundated the western side of Bangkok.
The most significant impact has been on electronics and automotive firms and consequently on global supply chains for those industries.
The fact that large companies normally have insurance coverage for their assets would help to mitigate damage to some extent, she said.
JP Morgan said the severe impact on local makers of hard-disk drives and other components would cut global PC production by up to 15% this year, but a recovery would begin in the first quarter of next year.
The floods are also expected to reduce tourism revenues by 20 billion baht with up to 800,000 visitors cancelling plans, Mrs Suchada said.
She also noted that bond yields had been falling as investors expect the central bank to cut its interest rate to help the recovery.
"The central bank could play a role to help the private sector through decisions by the Monetary Policy Committee," she said. "This is a straightforward thing that we can do."
The MPC is due to hold its next meeting at the end of this month. At its Oct 19 meeting it left its interest rate unchanged at 3.5%.
The central bank currently has enough policy space to adjust to accommodate private-sector activities, after continual interest rate increases," Mrs Suchada said.
"Demand for bonds] in the central bank's auctions has recently increased, compared to a shortage of demand in the past. This showed that the market has priced in the MPC's future rate cuts. It is currently a good time to issue bonds."
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