In January, Thailand’s economy grew due to increased domestic and external demand, especially in tourism and private consumption. However, construction contracted, while inflation varied. Key issues include U.S. trade policy and tourism recovery.

Key Highlights 📊

• Overall Expansion: The Thai economy grew compared to December, supported by stronger domestic and external demand.
• External Demand:
  • Merchandise exports (excluding gold) increased, especially electronics.
  • Exports of gems, jewelry, and petroleum products rose temporarily due to firm-specific factors.
  • Tourism improved with higher foreign arrivals and receipts.
• Domestic Demand:
  • Private consumption and investment strengthened.
  • Vehicle sales surged, driven by accelerated purchases ahead of the EV 3.0 scheme deadline and extended registration.
• Government Spending: Expanded but slowed, mainly due to reduced capital expenditure after earlier front-loading.
• Supply-Side Conditions:
  • Services slightly contracted, mainly from a decline in construction activity.
  • Tourism and trade-related services continued to expand.
  • Manufacturing production remained broadly stable.
• Inflation & Stability
• Headline Inflation: Turned more negative, driven by lower raw food and energy prices.
• Core Inflation: Stayed positive and stable, reflecting higher vehicle prices (excise tax adjustments) but offset by promotional discounts in personal care.
• Current Account: Recorded a surplus, supported by net services, income, and transfers, despite a trade deficit from higher imports.

Thailand’s economy in January saw growth fueled by increased exports, particularly in electronics, gems, and jewelry, as well as improved tourism and domestic demand. Vehicle sales surged due to accelerated purchases before the EV 3.0 scheme’s expiration. However, government spending slowed due to previous capital expenditure front-loading, causing a decline in construction and a slight moderation in services, while manufacturing production remained stable.

Source : https://www.bot.or.th/en/news-and-media/news/news-20260227.html

Other People are Reading

The euro slid, Swiss franc rose and the dollar jumped on Monday as investors headed for safety after the U.S. and Israel bombed Iran, killing supreme leader Ayatollah Ali Khamenei to open a power vacuum and raise the risk of a protracted Mideast war.

The franc climbed about 0.2% to 0.7674 per dollar and shot 0.6% higher to its strongest level since 2015 on the euro at 0.9030 in the early hours of the ‌Asia session.

The euro ⁠fell 0.3% ⁠to $1.1781 and the yen initially rose but was held back by Japan’s big oil imports, and last traded a fraction weaker at 156.32 to the dollar.

Sterling and the Australian dollar slid by more than 0.5% and China’s yuan fell about 0.2% in offshore trade, since China is an energy importer and the main buyer of Iranian oil.

“You don’t know how long this is going to last, how high oil is going to go, how long the Strait of Hormuz is going to be closed,” said BNZ strategist ⁠Jason Wong ‌in Wellington.

“The initial reaction is mild risk off, and you’ve just got to take each day as it comes.”
The Israeli military said its air force killed Khamenei and his ⁠death, at 86, was confirmed by Iranian state media, setting off a high-stakes succession race. Attacks extended into Sunday and Iran has hit back, with the Iranian Revolutionary Guard saying it had struck three U.S. and British oil tankers, while blasts were reported over Dubai and Doha.

Oil prices are markets’ initial top focus and leapt around 9% in early Monday trade on the disruption to seaborne trade.

Currencies of exporters such as Canada and Norway were steady in Asia’s early morning.

The risk-sensitive Australian dollar fell 0.7% to $0.7065, though traders thought the more durable pressure would ‌probably fall on energy importers.

“The euro is in a difficult spot,” said Wells Fargo analysts in a note.

“Europe’s natural gas storage refill season is about to begin and the EU is heading into it with record-low ⁠gas in storage, implying it will need to buy a large chunk of energy right as prices potentially shoot higher.”

Israeli military spokesperson Lieutenant Colonel Nadav Shoshani said many targets remained, but deploying ground forces was not under consideration. U.S. President Donald Trump told the Daily Mail the campaign could run for a month.

“We figured it will be four weeks or so. It’s always been about a four-week process,” he said.

At least 150 tankers including crude oil and liquefied natural gas vessels dropped anchor in open Gulf waters beyond the Strait of Hormuz and dozens more were stationary on the other side of the chokepoint, shipping data showed on Sunday.

Eight countries that are part of the OPEC+ oil cartel announced Sunday they will boost production of crude as U.S. and Israeli forces launched a major attack on Iran and the country responded with retaliatory strikes against Israel and U.S. military installations around the Gulf, disrupting oil shipments from the region.

The Organization of Petroleum Exporting Countries, in a Sunday meeting planned before the war began, said it would increase production by 206,000 barrels per day in April, which was more than analysts had been expecting. The countries boosting output include Saudi Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria and Oman.

Attacks throughout the region, including on two vessels traveling through the Strait of Hormuz, the narrow mouth of the Persian Gulf, could restrict countries’ ability to export oil to the rest of the world. That would will likely result in higher prices for crude oil and gasoline, according to energy experts.

Roughly 15 million barrels of crude oil per day – about 20% of the world’s oil – are shipped through the Strait of Hormuz, making it the world’s most critical oil chokepoint, according to Rystad Energy. Tankers traveling through the strait, which is bordered in the north by Iran, carry oil and gas from Saudi Arabia, Kuwait, Iraq, Qatar, Bahrain, the UAE and Iran.

Iran had temporarily shut down parts of the strait in mid-February for what it said was a military drill. Further disruptions to that shipping channel could lead to lower supply and higher prices for oil.

“Roughly one-fifth of global oil supply passes through the Strait of Hormuz, a vital artery for world trade, meaning markets are more concerned with whether barrels can move than with spare capacity on paper,” said Jorge Leon, Rystad’s senior vice president and head of geopolitical analysis, in an email. “If flows through the Gulf are constrained, additional production will provide limited immediate relief, making access to export routes far more important than headline output targets.”
Iran exports roughly 1.6 million barrels of oil a day, mostly to China, which may need to look elsewhere for supply if Iran’s exports are disrupted, another factor that could increase energy prices. Energy experts believe oil prices could shoot higher when barrels begin trading late Sunday. Analysts at Rystad anticipate the price of a barrel of Brent crude, the international standard, could increase by $20 when trading opens.

A barrel of Brent crude closed at a seven-month high of $72.87 on Friday.