Recent growth in the Thai economy remained subdued, weighed down by weakness in domestic demand. However, some positive developments are emerging. After contracting for several consecutive quarters, private investment rebounded in Q2 and Q3 2025 amid a surge in foreign direct investment (FDI) commitments. Increasing investments in high-value sectors offer pathways to more resilient growth.
Looking ahead, Thailand’s growth is projected to slow to 2.2 percent in 2025 and 1.9 percent in 2026, reflecting the unwinding of front-loaded exports and persistent private sector weakness. However, medium-term growth is expected to gradually improve, supported by more investment-focused fiscal spending and increasing FDI in EVs, electronics, and data centers. Inflation is expected to remain below target, at 0.5 percent and 0.8 percent in 2025 and 2026. In the absence of significant supply-side shocks, inflation expectations are expected to remain well anchored within the Bank of Thailand’s inflation target range of 1 to 3 percent going forward.