Vittaya Ratanakorn, Governor of the Bank of Thailand (BOT), revealed that the BOT has assessed Thailand's economic growth for 2026 to likely expand by 2.0%.This is due to the effects of measuresstimulating the economy by the government underthe 400 billion baht borrowing decree,which is an upward revision from the previous forecast of 1.5% GDP growth following impacts from war and global economic uncertainties.
Meanwhile, in 2027, the growth rate is expected to slow down, with GDP projected at 1.7%, after government stimulus measures in 2026 boosted economic expansion beyond earlier projections.
Regarding the general inflation rate in 2026, it is expected to accelerate temporarily due to energy prices and cost pass-through,as well as the effectsof the El Niño phenomenonand measuresto stimulate consumption by the government. The annual inflation is forecast at about 3%, with some months potentially seeing inflation surpass 5%, driven by the 400 billion baht borrowing decree used for the Thai Help Thai Plus program and promotion of clean energy usage. Inflation is expected to peak at 5.2% in October this year.In October 2026.
Meanwhile, in 2027, inflation is expected to decline to approximately 1.4% due to anticipated lower energy prices afterthe Middle East warends.
However, Vittaya emphasized that the BOT is not concerned about the rising inflation but is only signaling a forecasted increase, as it views this as a temporary factor. Inflation is expected to begin declining inthe second quarterof 2027 and return to the 1-3% target range.Therefore,it is assessed that Thailand's policy interest rate will remain at 1.0%. The Monetary Policy Committee (MPC) will hold its next interest rate decision meeting on 24 June 2026.The BOTalso reaffirms that Thailand is not at risk of entering stagflation.
Additionally, the BOT confirmed it is not concerned about a dual deficit—deficits in both the current account and the budget—despite a record high current account deficit in April2026 of 7.6 million US dollars, viewing this asa temporary situation caused by fuel importsand rising fuel prices.Looking ahead,
it is assessed thatthe current account deficit for 2026 may approach zero, as the trade balance is expected to return to surplus in the fourth quarter of this year. Exports are forecast to grow well this year at around12-13%, up from the previous estimate of 8.1%.Read more news on "government policy"