Thai Q2 GDP grows below forecast at 1.8%, outlook trimmed

BANGKOK (Reuters) – Thailand’s economy expanded slower than expected in the second quarter, data showed on Monday, with strength in tourism helping to counter weaker exports amid a slowdown in global demand.

The government cut its 2023 gross domestic product growth forecast to 2.5% to 3.0% from a range of 2.7% to 3.7%, citing slower exports.

Southeast Asia’s second-largest economy grew 1.8% in the April-June period from a year earlier, the National Economic and Social Development Council (NESDC) said, below the 3.1% expansion expected by economists in a Reuters poll.

Gross domestic product (GDP) had risen 2.7% year-on-year in the first quarter.

On a quarterly basis, GDP rose a seasonally adjusted 0.2% in the June quarter, versus a forecast rise of 1.2%.

First-quarter GDP was revised to 1.7% from an earlier 1.9% increase.

As weak global demand crimps exports, Thailand’s economy has been supported by its vital tourism sector and private consumption growth.

The agency maintained a forecast of 28 million foreign tourist arrivals this year. It projected exports to drop 1.8% in 2023 versus an earlier forecast for a 1.6% fall.

Exports, a key driver of growth, have contracted since October 2022, due to soft global demand, especially due to a slowdown in China, Thailand’s major trading partner.

(Reporting by Orathai Sriring, Kitiphong Thaichareon and Satawasin Staporncharnchai; Editing by Martin Petty)