# Thailand’s economy held steady in May, supported by growing tourism and a slight increase in domestic demand

- Link: https://www.thailand-business-news.com/banking/318179-thailands-economy-held-steady-in-may-supported-by-growing-tourism-and-a-slight-increase-in-domestic-demand
- Published: 2026-07-03T11:06:00+07:00
- Author: SiamNews PR

**In May, Thailand’s economy stabilized with increased tourism and slight domestic
demand improvement. However, exports fell, manufacturing declined, and inflation
remained elevated. Key concerns include living costs, geopolitical risks, and El
Niño impacts.**

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Summary

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 * The Thai economy in May remained broadly stable compared to the previous month.
   
   o On the external front, tourism receipts and foreign tourist arrivals overall
   increased, supported by a recovery in long-haul markets and an increase in tourist
   arrivals from China and Malaysia due to their long holiday period. However, other
   short-haul tourists declined due to weaker demand and reduced flights. Merchandise
   exports excluding gold decreased, mainly due to lower exports of electronics 
   and jewelry following earlier acceleration in the previous period.o Domestic 
   demand improved slightly, supported by increases in private consumption and private
   investment, particularly in the automotive sector. However, consumption and investment
   in other categories remained relatively stable.o On the supply side, Manufacturing
   production declined in line with merchandise exports, while the services sector
   remained broadly stable.

**The Thai economy in May remained broadly stable compared to the previous month.**
Tourism receipts increased overall, in line with higher foreign tourist arrivals,
as supported by a recovery in long-haul markets as well as increased arrivals from
China and Malaysia due to their long holiday periods. However, arrivals from other
short-haul markets declined due to weaker demand and reduced flight services amid
elevated energy costs. Merchandise exports excluding gold declined, mainly due to
lower exports in electronics and jewelry after having accelerated in the previous
period. 

**Domestic demand improved slightly,** supported by higher private consumption and
investment, particularly in the electric vehicle sales, partly reflecting a shift
toward the electric vehicle usage amid elevated domestic fuel prices. However, consumption
and investment in other categories remained broadly stable. Government expenditure
expanded from the same period last year, driven by both current and capital expenditures
of the central government. 

**On the supply side, economic activity remained broadly stable. **Manufacturing
production declined in line with weaker merchandise exports, while the services 
sector remained broadly unchanged.

**Headline inflation remained elevated but broadly stable**. Energy prices declined
slightly, while core inflation increased marginally.

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**Key issues to monitor**: 1) The impact of elevated cost of living and production
costs on households and businesses 2) geopolitical risks and U.S. trade policy, 
3) the impact of government measures, and 4) El Niño developments

**Source** : [https://www.bot.or.th/en/news-and-media/news/news-20260630.html](https://www.bot.or.th/en/news-and-media/news/news-20260630.html?rand=113190)