• Key policy rate: 1.25% (December 2025)
• Q4 2025 GDP growth rate: 2.5%; full-year 2025: 2.4%  
• Manufacturing Purchasing Managers’ Index reading: 52.7 (January 2026)
• Inflation rate: -0.66% (January 2026)

Thailand’s economy has been struggling to restore its pre-pandemic growth pace, with average annual expansion easing to 2 per cent between 2021 to 2023 while its Southeast Asian peers are racing ahead. Slowing productivity growth coupled with high household debt, weak public investments, and softening tourism revenues have constrained economic growth in recent years.

Consumer spending has decelerated for three straight years to 2024, and in response, the Thai government is seeking to spur household consumption through cash handouts worth THB 10,000 (about USD 294) to 50 million residents. However, the dole outs have come at a time of a growing public sector burden. A recovery in tourism receipts and stronger private consumption would support faster GDP expansion, while reduced political uncertainty will support an increase in private sector investments. So far, the country has had seven prime ministers over the last four years, each one putting forward a different set of policy priorities that raises instability.

Thailand has reversed to a trade deficit in recent years, with electronics, motor vehicles, and rice and agricultural products serving as major exports. By sector, the services industry accounts for two-thirds of Thailand’s GDP, led by the transportation and food and hospitality businesses, the latter being the fastest-growing segment. Industrial production contributes about 30 per cent of economic output, while about 5 per cent comes from agriculture.

House view: A boost in private domestic consumption through a cash stimulus package to households would bode well for Thailand’s economy in the short term. Also, a recovery in household spending will allow Thailand to continue to outpace the growth of mature economies and manage its piling debt burden.

Updated as of 23 February 2026