Kasikorn Research Center (K-Research) expects key economic cabinet appointments by Prime Minister Anutin Charnvirakul will lift public confidence and raise Thai GDP growth above earlier projections.
Burin Adulwattana, managing director at K-Research, said the proposed economic ministers, particularly those from the private sector with strong expertise, credibility and trust, are likely to enhance confidence among both local and international investors.
“In particular, the potential revival of the Khon La Khrueng co-payment programme should support private consumption, strengthen spending confidence, and help drive the Thai economy in the second half of the year,” Mr Burin said.
K-Research awaits further details and clarity on the co-payment scheme to assess its full economic impact, especially the proportion of cost-sharing between the government and consumers given the scheme’s 25-billion-baht budget limit.
As a result, the research unit upgraded its Thai GDP growth forecast for 2025 from 1.5% to 1.8%, benefiting from front-loaded shipments to the US ahead of tariff measures under Section 232 and transshipment tariffs.
Meanwhile, the slowdown in Thai exports during the second half of 2025 could be mitigated, reducing the risk of a technical recession, according to K-Research.
The economy still faces challenges from the direct and indirect effects of US tariffs, slower tourism, and domestic political factors that require monitoring, he said.
The centre also upgraded Thailand’s export growth forecast from 3.4% to 5.7%, while easing the public investment growth forecast from 4% to 3.5%, mainly due to a delayed 2026 budget disbursement amid the political deadlock.
Mr Burin said the baht’s appreciation against the US dollar could pressure export revenues in the second half of the year. The currency is expected to strengthen due to easing US Federal Reserve policy and domestic political factors.
The Fed is expected to cut its policy rate three times in 2025 and twice next year. Recent interventions by the US president regarding the Fed’s independence have further fuelled market expectations for faster and steeper rate cuts starting this month.
K-Research expects the Bank of Thailand to reduce its policy rate once more, from 1.5% to 1.25% by the end of this year. The central bank is projected to continue easing rates, supported by short-term economic stimulus measures from the new government, said Mr Burin.
Thanyalak Vacharachaisurapol, deputy managing director at K-Research, said if the baht breaks the current level of 31.5 per dollar, it could strengthen by around 0.20 baht against the greenback. In the short term, the stronger baht is primarily driven by a weaker dollar, in line with the Fed’s monetary policy direction.
Ms Thanyalak said a clearer domestic political environment, particularly confidence in the new government’s economic team, would support baht appreciation against the dollar. However, the full effect depends on the team’s economic policies, she said.
credit : https://www.bangkokpost.com/business/general/3101836/new-ministers-may-lift-economic-growth
