The Tisco Economic Strategy Unit (ESU) forecasts a 3% growth in Thailand’s GDP for the coming year, aligning this growth with a projected 3.2% expansion of the global economy. This comes amidst concerns over potential trade wars and rising inflation, which may pose challenges to these optimistic forecasts.
Economist Methas Rattanasorn highlighted that the anticipated growth for Thailand is driven by increased public and private investments, a resurgence in tourism, and supportive monetary policies. These factors are expected to boost the Thai economy to 3% growth in 2025, surpassing this year’s predicted growth rate of 2.8%.
Nevertheless, several risk factors could impede these projections. Potential trade conflicts, geopolitical tensions, and volatile oil prices contribute to an uncertain economic future. Methas noted that while a 3.2% growth is expected globally, US trade protectionism could disrupt international supply chains.
“The conflict in the Middle East and the ongoing Russia-Ukraine war continue to influence energy prices, potentially leading to inflationary pressures.”
Moreover, many developed nations may cut back on budget deficits due to heavy debt obligations, potentially slowing economic momentum. Conversely, developing Asian countries are thriving, propelled by advancements in electronics and artificial intelligence sectors.
Tisco ESU anticipates that the Bank of Thailand (BOT) will lower the policy interest rate by 25 basis points to 2% next year to bolster economic growth. However, challenges persist, including sustained high household debt, deteriorating credit quality, and the ongoing US-China trade tensions.
Thailand GDP
Komsorn Prakobphol, head of Tisco ESU, pointed out that oil prices and debt instruments have the potential for growth in 2025. The price of WTI crude oil is projected to hover around US$80 per barrel, partly due to constrained production increases from OPEC+ and other leading producers.
Gold prices might also rise if geopolitical tensions escalate, global interest rates decrease, and the US dollar weakens, said Komsorn.
“While the global stock market in 2025 may face challenges from trade and inflation policies, equities are still seen as appealing investment options. We suggest investing in US consumer discretionary and financial stocks, which stand to benefit from tax reductions and economic stimulus measures.”
Japanese stocks are poised to gain from a strengthening economy and reduced trade war risks. The Thai stock market, however, remains under pressure from uncertain earnings of listed companies, with the state-owned Vayupak Fund having depleted much of its resources, and relatively low investments in Thai ESG Funds, reported Bangkok Post.
“Investors should consider diversifying their portfolios by including global and alternative assets, keeping an eye on US economic policies that might affect international fund movements,” Komsorn added.
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