A beach town in Thailand

Thailand Economic Forecast

Thailand Economic Outlook

The economy lost considerable steam in Q4 2022. The slowdown reflected deteriorations in private and public consumption, fixed investment and exports. Specifically, a significant decline in spending on durable goods, a deceleration in private investment growth, a notable post-Covid-19 contraction in medical spending and falling foreign sales of petro-chemical products and vehicle parts weighed on the economy. Moving into the current quarter, data for January points to improving economic conditions: Business and consumer sentiment strengthened—with the latter reaching a 26-month high—the manufacturing PMI moved further into expansionary terrain, and inflation declined again. Moreover, the reopening of the Chinese economy is likely supporting activity via tourism and trade. Meanwhile, in early February, Thailand and Malaysia announced stronger infrastructure, trade and investment cooperation.

Thailand Inflation

Inflation slowed to 5.0% in January from December’s 5.9%, thus moving closer to the upper bound of the Bank of Thailand’s 1.0–3.0% target. Inflation should gradually ease and move within the Central Bank’s target by Q2 2023, limited by lower commodity prices and a tighter monetary policy stance. Volatile energy and food prices and China’s economic reopening pose risks.

Thailand Economic Data

2017 2018 2019 2020 2021
Population (million) 69.2 69.4 69.6 69.8 70.0
GDP (USD bn) 456 506 544 500 505
GDP per capita (USD) 6 7 7 7 7
GDP (THB bn) 15 16 16 15 16
Economic Growth (Nominal GDP, ann. var. %) 6.2 5.7 3.2 -7.3 3.3
Economic Growth (GDP, ann. var. %) 4.2 4.2 2.1 -6.2 1.6
Domestic Demand (ann. var. %) 5.5 7.7 1.5 -1.4 3.3
Private Consumption (ann. var. %) 3.1 4.6 4.0 -0.8 0.6
Government Consumption (ann. var. %) 0.3 2.7 1.6 1.4 3.7
Fixed Investment (ann. var. %) 1.8 3.9 2.0 -4.8 3.1
Exports (G&S, ann. var. %) 5.2 3.4 -3.0 -19.7 11.1
Imports (G&S, ann. var. %) 6.2 8.3 -5.2 -13.9 17.8
Manufacturing Production (ann. var. %) 1.7 3.8 -3.4 -9.5 5.8
Retail Sales (ann. var. %) 6.3 10.8 3.2 -10.2 9.7
Unemployment (% of active population, aop) 1.2 1.1 1.0 1.7 1.9
Fiscal Balance (% of GDP) -3.5 -2.5 -1.9 -6.8 -5.5
Public Debt (% of GDP) 41.2 41.8 41.2 52.0 59.7
Inflation (CPI, ann. var. %, eop) 0.8 0.4 0.9 -0.3 2.2
Inflation (CPI, ann. var. %, aop) 0.7 1.1 0.7 -0.8 1.2
Inflation (Core, ann. var. %, aop) 0.6 0.7 0.5 0.3 0.2
Inflation (PPI, ann. var. %, aop) 0.7 0.5 -0.7 -1.6 4.7
1-Day Repurchase Rate (%, eop) 1.50 1.61 1.25 0.50 0.50
3-Month BIBOR (%, eop) 1.57 1.86 1.37 0.62 0.62
10-Year Bond Yield (%, eop) 2.36 2.45 1.50 1.17 1.95
Stock Market (ann. var. of SET %) 13.7 -10.8 1.0 -8.3 14.4
Exchange Rate (THB per USD, eop) 32.6 32.6 30.0 30.0 33.4
Exchange Rate (THB per USD, aop) 33.9 32.3 31.1 31.3 32.0
Current Account Balance (USD bn) 44 28 38 21 -11
Current Account Balance (% of GDP) 9.6 5.6 7.0 4.2 -2.1
Merchandise Trade Balance (USD bn) 33 22 27 40 32
Merchandise Exports (USD bn) 233 251 243 227 271
Merchandise Imports (USD bn) 201 229 216 186 238
Merchandise Exports (ann. var. %) 9.3 7.6 -3.3 -6.5 19.3
Merchandise Imports (ann. var. %) 13.0 13.9 -5.6 -13.7 27.9
Foreign Direct Investment (USD bn) 8 13 5 -5 11
International Reserves (USD bn) 203 206 224 258 246
International Reserves (months of imports) 12.1 10.8 12.5 16.6 12.4
External Debt (USD bn) 156 163 172 191 196
External Debt (% of GDP) 34.2 32.2 31.6 38.1 38.9

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