Gold bars to be exempt from tariffs, White House clarifies
Investing.com -- Thailand’s economy is expected to be impacted by U.S. tariffs on its exports, according to a senior official from the Bank of Thailand. However, the effect on the country’s economic activity won’t be as significant as the one experienced during the COVID-19 pandemic.
The U.S. tariffs have already resulted in halted production and postponed investment decisions. The impact on Thailand’s exports will become evident in the second half of the year, according to Bank of Thailand Assistant Governor Sakkapop Panyanukul. He emphasized that the global trade policy uncertainty is a substantial and prolonged shock that will affect Thailand in numerous ways.
Among Southeast Asian countries, Thailand is one of the most affected by the proposed measures of U.S. President Donald Trump. The country faces a 36% tariff if a reduction can’t be negotiated before a global moratorium expires in July.
The Thai economy is now predicted to grow less than 2.5% this year, which is below the previous forecast. This is partly due to the fact that increased U.S. imports to reduce Thailand’s trade surplus with America will impact local manufacturing. "GDP will definitely decrease," Sakkapop stated, though the exact decrease remains uncertain.
However, Sakkapop noted that the impact of the tariffs won’t be as severe as the one during the COVID-19 pandemic. Additionally, due to a strong start in 2025, the overall full-year export growth might not be too negatively affected.
In terms of inflation, it is expected to decrease, driven by supply-side factors. However, Sakkapop stated that there is no pressure on the country’s monetary policy. Earlier this year in February, the central bank reduced the key interest rate by 25 basis points to 2.00%. This decision was a response to a weaker growth outlook and the increased risks posed by global trade policy uncertainty.
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