Thailand: Investment-led growth strengthens in June

Research evidence excerpt

Thailand: Investment-led growth strengthens in June

Charnon Boonnuch Asia Pacific Economic Research J P M O R G A N(65) 6807 5086 01 August 2026

charnon.boonnuch@jpmorgan.com

Brighter post-election economic outlook, 3 March 2026).

We maintain our 2Q26 GDP growth estimate of 2.5%oya down from 2.8% in 1Q26, taking

into account the improvement in private sector spending data today. We acknowledge

concerns about the weakening of manufacturing output in June for which the data were

reported earlier this week (see Thailand: Weaker-than-expected manufacturing output in

June, 27 June 2026).

However, the BOT suggested on 31 July that the slowdown partly reflected the temporary

maintenance shutdown of some refineries and added that the manufacturing output data may

not fully reflect the underlying economic activity. The BOT, along with other government

agencies, is reviewing the leading indicators for the manufacturing sector.

We maintain our out-of-consensus 2026 CAD forecast

We maintain our 2026 CAD forecast at 2.2% of GDP, which we have also recently revised

down from a surplus of 0.4%, and is consistent with our higher-conviction investment-led

growth outlook. Our forecast is well below the consensus forecast of a surplus of 1.0% of

GDP and represents the first deficit since 2022. The swing to a CAD, however, reflects the

healthy improvement in domestic demand, in our view, rather than just the worsening terms

of trade. In addition, as we have argued, the large CAD in 2Q26 was likely to be financed by

improving financial inflows.

On the trajectory, we expect the CAD to persist in 3Q26, though narrowing materially to

USD1.5bn from USD17.7bn in 2Q26. Our forecast implies a return to a surplus of USD4.2bn

in 4Q26, in line with the seasonal improvement in tourism revenues.