Krungsri Research has revised up its forecast for Thailand's economic growth in 2026 to 2.1%, from 1.9% previously, supported by private investment, exports, and government measures. However, risks remain from geopolitics, US tariff measures, and El Niño. The Thai economy expanded 1.9% year-on-year in the second quarter, better than expected, although it slowed from the previous quarter. Accelerating imports led to the first current account deficit in eight quarters. Krungsri Research expects private investment to be boosted by BOI and FDI, as well as the Thailand FastPass project. Exports are expected to grow in sectors related to AI and electronics, but the overall picture may slow due to weak global demand. The tourism sector is recovering gradually. Private consumption is likely to slow in the final quarter, despite the "Thai Teaw Thai Plus" measure worth 3.50 billion baht, which is smaller than the "Thai Chuay Thai Plus" measure worth 120 billion baht. The Monetary Policy Committee is expected to keep the interest rate at 1.00% per annum for the rest of the year. Dr. Pimnara Hirankasi, head of economic research at Krungsri, said that positive factors from the second quarter and government measures, but El Niño may affect the agricultural sector. Future challenges include geopolitical tensions, uncertainty over US trade measures, and structural constraints.
Bank of Ayudhya PCLKrungsri Research (Bank of Ayudhya's research arm) raised Thailand's 2026 GDP forecast and expects the MPC to hold rates at 1.00%, a macro backdrop for the bank.
