Thailand GDP Drop Marks Steepest Quarterly Decline Since 2021

A sharper-than-expected Thailand GDP drop in Q3 underscored mounting economic headwinds as weaker factory output and a softer tourism recovery dragged growth to 1.2% year-on-year, below the 1.6% forecast and down from 2.8% in the previous quarter.

On a quarterly basis, GDP contracted 0.6%—the first decline since late 2022 and the steepest since mid-2021—as exports, manufacturing, construction, government spending, and tourism all lost momentum amid US tariffs and a tougher global backdrop.

The Thailand GDP drop mirrors the Philippines also missing Q3 estimates, and highlights the challenge facing new Prime Minister Anutin Charnvirakul, who has launched a 44bn-baht (USD1.2bn) stimulus to support consumption.

Meanwhile, the incoming Bank of Thailand governor has pledged to address the country’s heavy household debt burden as policymakers confront weakening domestic demand and external uncertainty.