BANGKOK, July 9 – Thailand’s central bank warned on Wednesday that its economy is set to slow sharply in the second half of 2025, cutting its full-year growth forecast to around 2.3% as rising U.S. tariffs threaten to reduce exports by roughly 4%.

The Bank of Thailand cited weakening external demand and heightened global uncertainty as key risks. Deputy Governor Piti Disyatat said the export-dependent economy faced “growing headwinds”, including fragile consumer confidence, rising household debt, and uncertainty over global trade.

The U.S. tariffs, set to take effect from August unless a deal is reached, could see duties on Thai electronics, auto parts and agricultural goods rise as high as 36%. Exports to the United States account for about one-fifth of Thailand’s outbound trade, making the country particularly vulnerable.

According to the Federation of Thai Industries, the tariffs could result in a direct economic loss of up to ฿900 billion ($27 billion) in the second half alone. Business groups have urged the government to accelerate trade diversification and support exporters with financial relief.

Finance Minister Pichai Naripthaphan said Thailand had submitted a new trade proposal to the U.S., offering tariff cuts on selected American imports and increased procurement of U.S. agricultural goods in hopes of de-escalating trade tensions.

Despite mounting pressure, the central bank left its policy rate unchanged at 1.75% in June, with most committee members preferring to wait for further data. However, analysts say rate cuts may be necessary if the situation deteriorates further.

Thailand’s economy has been grappling with subdued domestic demand and slower-than-expected tourism recovery. Economists warn that without coordinated fiscal stimulus and structural reforms, growth may remain stuck below potential.

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References

Bank of Thailand, 2025. Thai exports seen falling 4% in H2 as US tariffs loom. Reuters, 9 July.

Federation of Thai Industries, 2025. Industry groups warn of ฿900 billion loss from US tariffs. Reuters, 8 July.

Ministry of Finance Thailand, 2025. Thailand submits revised trade proposal to U.S. Reuters, 7 July.

Bank of Thailand, 2025. Policy statement and rate decision – June meeting. Kaohoon International, 25 June.

Economic Outlook Division, 2025. Macroeconomic assessment for H2 2025. Kaohoon International, 5 July.