Thailand Business Morale at 4-Month High

Thailand’s Business Sentiment Index rose to 46.7 in July 2026 from 46.1 in June, the highest reading in four months.The improvement was driven mainly by stronger sentiment in the non-manufacturing sector, supported by lower fuel costs and increased flight services, while gains were partly offset by weaker confidence in manufacturing amid concerns over US import tariffs. Sentiment improved for business performance (50.0 vs 49.3) and investment (51.2 vs 50.7), while expectations for production (48.6 vs 51.9), employment (48.9 vs 50.2), and total order books (47.5 vs 48.1) turned less optimistic. Meanwhile, manufacturing confidence weakened, led by lower order books in the home electrical appliance industry. High production costs remained the top business constraint for the fifth straight month, while inflation expectations for the next 12 months eased slightly to 2.6%. Moreover, the three-month expected Business Sentiment Index rose to 50.7 from 48.0.

Thailand’s Business Sentiment Index rose to 46.1 in June 2026 from 42.5 in May, marking its least pessimistic reading in three months. The improvement was driven by the easing of the Middle East conflict, lower energy prices, and the government's "Thais Help Thais Plus" scheme, which temporarily boosted domestic purchasing power. Sentiment strengthened across production (51.9 vs 44.0 in May), business performance (49.3 vs 43.7), and total order books (48.1 vs 43.6). Manufacturing confidence improved across all industries, led by the automotive sector, while the chemical industry benefited from lower energy costs and alternative raw material sourcing. Non-manufacturing sentiment also strengthened, mainly in retail and wholesale trade. Meanwhile, the three-month expected Business Sentiment Index increased to 48.0 from 46.9. Cost pressures eased markedly as lower energy prices reduced production costs, while 12-month inflation expectations were unchanged at 2.7%.

Thailand’s Business Sentiment Index fell to 42.5 in May 2026 from 43.5 in the previous month. This marked the lowest level since August 2021, weighed down by the prolonged Middle East conflict. Sentiment continued to deteriorate for production (44 vs 48.2 in April), performance (43.7 vs 47), overall order books (43.6 vs 44.2), and export conditions (45 vs 46.4). By sector, manufacturing sentiment softened across several industries, led by the automotive sector, where production and performance sub-indices fell sharply amid intensifying competition in vehicle sales. The food and beverage industry also faced mounting pressures, as packaging costs remained 30% to 50% higher than pre-conflict levels and elevated freight rates continued to delay orders from Middle Eastern markets. Meanwhile, sentiment in the non-manufacturing sector remained broadly unchanged from the previous month. The three-month expected Business Sentiment Index rose to 46.9 in May from 40.9 in April.