Macro and Politics

*The CBT will release the November Real Sector Confidence Index and Capacity Utilization Rate @ 10:00 local time today. The unadjusted Real Sector Confidence Index (RSCI) rose from 100.2 to 100.8 in October, while the seasonally adjusted index increased from 100.8 to 102. Meanwhile, the Capacity Utilization Rate (CUR) inched up from 74.0% to 74.2%, and the seasonally adjusted CUR rose from 73.8% to 74.0%. An analysis of the subcomponents of the RSCI indicates that assessments regarding current inventories of final goods, current order levels, employment and production expectations for the next three months, overall business sentiment, investment spending, and export orders contributed positively to the index. On the other hand, weaker assessments concerning total orders over the past three months exerted a modest downward impact. Overall, the data suggests that firms remain cautiously optimistic about the near-term outlook, with mild signs of recovery in production and employment expectations. Evaluations regarding the past three months point to a strengthening trend in production activity and a rebound in export orders. The convergence of current order levels toward seasonal norms and a decline in inventory levels imply that the slowdown in domestic demand has been partially offset. Meanwhile, although expectations for future production and orders remain somewhat guarded, the improvement in investment spending intentions signals a modest revival in investment appetite. We assess that an annual growth rate of around 4.5% is achievable in the third quarter of this year. While our 2025YE growth forecast stands at 3.4%, we view the balance of risks around this projection as skewed to the upside.