Thailand’s economy is projected to grow over 2.5% in 2025, hindered by weak global demand, high household debt, and uneven recovery. The Bank of Thailand cut interest rates to stimulate growth.
Economic Growth Forecast
Thailand’s economy is projected to grow slightly above 2.5% this year, a revision stemming from challenges such as weaker global demand and a slower recovery in tourism. The Bank of Thailand (BoT) also expressed concerns over the rising household debt and uncertainties in the global economy, which may impede domestic consumption and investment.
Monetary Policy Adjustments
In response, the BoT’s monetary policy committee voted 6-1 to reduce the one-day repurchase rate by 25 basis points to 2.00%. This decision aims to improve credit conditions amidst an uneven recovery. While the central bank had previously forecasted 2.9% growth for the year, it has since acknowledged the presence of downside risks.
Structural Challenges
High household debt, standing at 16.34 trillion baht (approximately $486 billion), poses a significant barrier to economic growth. Although tourism and exports are growing, the manufacturing sector faces structural issues, particularly in automotive and real estate. Policymakers believe that long-term structural reforms are essential for improving economic conditions in Thailand.
Source : Thai Economy Projected to Grow just Over 2.5% in 2025, Says Bank of Thailand
