Thailand Business Morale at Over 4-Year Low

Thailand Business Sentiment Index fell to 43.5 in April 2026 from 47.7 in the previous month, as Middle East war disruptions weighed on activity. This marked the lowest level since September 2021, led by weakness in production costs (21.6 vs 34.2 in March) and performance (47.0 vs 51.0). Sentiment weakened across overall order books (44.2 vs 47.9), production (48.2 vs 51.3), and investment (49.6 vs 51.8), while export conditions were less negative (46.4 vs 45.5). The manufacturing index weakened, led by the petrochemical and plastics industries, which were particularly hit due to tighter supply of upstream feedstocks. The hotel and restaurant sector also deteriorated, with sentiment falling to its lowest level since the COVID-19 pandemic, driven by reduced long-haul tourist arrivals amid fewer flights, higher airfares, and heightened safety concerns. The 3-month expected BSI dropped to 40.9, reflecting concerns over a potentially prolonged situation.

Thailand’s Business Sentiment Index fell to 47.7 in March 2026, the lowest level in seven months, down from 49.6 in February, as sentiment was weighed down by the impact of the Middle East conflict. Total order books contracted (47.9 vs 52.2) and export conditions weakened (45.5 vs 48.2) while output prices went up (50.6 vs 49.7). The hotel and restaurant sector was particularly hit, with sentiment falling to an eight-month low, owing to cancellations of flight tickets and hotel bookings by Middle Eastern tourists, along with the suspension of direct flights from Middle Eastern airlines to Thailand. Also, the manufacturing index weakened, led by plastics pellets and packaging industries, as the closure of the Strait of Hormuz pushed energy prices higher, affecting transportation costs and imported feed stocks for plastic manufacturing, such as crude oil and naphtha. Also, the 3-month expected BSI dropped to 44.2, reflecting concerns over a potentially prolonged situation.

Thailand's business confidence indicator rose to 49.6 in February 2026, improving from a three-month low of 49.1 in the previous month. Sentiment strengthened for overall order books (52.2 vs 50.5 in January), investment (52.5 vs 51.4), and employment (50.8 vs 49.1). Meanwhile, sentiment weakened for performance (50.7 vs 51.3) and products (51.4 vs 52.4), while it deteriorated further for production costs (39.5 vs 39.7) and output prices (49.7 vs 49.8). By sector, the manufacturing index increased across nearly all industries, led by steel, which reported stronger demand from both domestic and overseas markets, particularly the US, and the electronics industry, supported by sustained growth in AI-related demand and data centers. The non-manufacturing index remained stable, despite a decline in retail trade, thanks to significant improvements in warehouse sector confidence. The three-month forward-looking sentiment index slightly eased to 52 from 52.3 in the previous month.