# Thailand’s central bank cuts its 2026 GDP growth forecast to 1.3%

- Link: https://www.thailand-business-news.com/economics/301230-thailands-central-bank-cuts-its-2026-gdp-growth-forecast-to-1-3
- Published: 2026-04-16T10:13:54+07:00
- Author: Angela Reyes

Thailand’s central bank has cut its 2026 GDP growth forecast and warned of virtually
unlimited downside risks as the ongoing Iran war disrupts tourism and drives up 
import costs.

### Thailand’s Central Bank Warns of Severe Economic Impact from Iran War

## Key Details:

 * The Bank of Thailand revised its 2026 GDP growth forecast down to **1.3%** (from
   1.9% in December), assuming the war ends in the second half of 2026.
 * Tourism from Gulf countries **fell to near zero** in March due to airport closures
   caused by Iranian attacks, with those visitors normally accounting for 7% of 
   total tourism spending.
 * Malaysian tourist numbers are also declining due to **high fuel costs** discouraging
   cross-border travel.
 * Inflation is forecast to reach **3.5%** under the baseline scenario; interest
   rate hikes are considered unlikely unless inflation persists beyond a year.
 * The previously expected **$12 billion current account surplus** may need to be
   revised downward, potentially turning negative.
 * Capital outflows in February and March were described as manageable, with flows
   returning to **positive territory in April**.
 * Bangkok will host the **IMF-World Bank autumn meetings in October 2026**, which
   officials hope will showcase Asia’s economic resilience.

Thailand is among the world’s most exposed economies to the Iran conflict due to
its heavy reliance on imported energy, and the central bank’s stark warnings highlight
the broad regional economic risks if the war continues.

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## Thailand’s Worst-Case Economic Scenarios Amid Prolonged Iran War

If the Iran war continues beyond a few months, Thailand faces severe economic contraction,
with GDP growth potentially falling to 0.2% and inflation surging to 5.8%, driven
by energy shocks, tourism collapse, and capital flight.

 * In a **prolonged conflict scenario (6–9 months)**, oil prices could climb to 
   $135–145 per barrel, triggering a global downturn and slashing Thailand’s GDP
   growth to **0.2%** while inflation spikes to **5.8%**
 * If the Strait of Hormuz remains closed, disrupting over 20% of global oil shipments,
   Thailand’s economy could slow further, with growth potentially dipping below 
   1%.
 * In an **extreme scenario**, oil prices could reach $200 per barrel, though analysts
   consider this unlikely; even $130+ per barrel for three months would sharply 
   raise inflation risks.
 * Foreign investors have already pulled back sharply, with **$823 million net selloff
   in equities** and **$705 million in bond outflows** in March — the largest combined
   outflow since October 2024.
 * The Thai baht has depreciated nearly **3% since the war began**, with forecasts
   predicting a slide to ฿35 per dollar if the conflict drags on.
 * Tourism from Gulf countries has fallen to near zero, and Malaysian visitors are
   declining due to high fuel costs, both critical to Thailand’s economy.

**Why It Matters:** Thailand’s heavy reliance on imported energy and tourism makes
it uniquely vulnerable; without policy flexibility or fiscal room, prolonged conflict
could push the economy into contraction, erasing recent hopes for reviva