Thailand’s central bank has issued its starkest economic warning in years. The Bank of Thailand’s (BOT) Monetary Policy Report for Q1 2026 revised the country’s GDP growth forecast sharply downward to just 1.5%, well below the 2.4% recorded in 2025, as the Monetary Policy Committee (MPC) voted to cut the benchmark interest rate to a historic low of 1.00% per year to cushion a slowing economy.
Why growth is slowing
Two forces are hitting Thailand at once, and neither is easy to resolve quickly.
The BOT said Thailand’s economy is likely to expand more slowly than previously expected, dragged down by prolonged geopolitical pressures and structural shifts in global production. GDP growth is now projected at 1.5% for 2026, before recovering to around 2.0% in 2027.
A rate cut, but not a unanimous one
At its meeting on 25 February 2026, the MPC voted 4 to 2 to cut the policy interest rate by 0.25 percentage points, from 1.25% to 1.00% per year, effective immediately. The two dissenting members preferred to hold the rate steady at 1.25%.
The BOT projects 33 million international tourist arrivals in 2026, generating around 1.4 trillion baht in tourism revenue, rising to 35.5 million arrivals and 1.6 trillion baht in 2027.
Sources: Bank of Thailand Monetary Policy Report Q1/2026 and Monetary Policy Forum 1/2026
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