Thailand & Asia | 28 August 2026
1. Thailand exports surge 21.6%, but imports widen trade deficit
Thailand’s exports rose 21.6% year-on-year in July to US$34.79 billion, extending the growth streak to 25 consecutive months. However, imports jumped 36.7% to US$38.40 billion, producing a monthly trade deficit of US$3.61 billion; electronics and high-tech investment-related products remained the main export drivers. (nationthailand)
Key figures: Exports Jan–July +18.2%; imports +37.8%; cumulative trade deficit US$35.35 billion. Exports excluding oil, gold and strategic goods increased 23.3% in July. (nationthailand)
Why it matters: The figures confirm that Thailand is benefiting strongly from the global electronics and AI investment cycle, but the much faster rise in imports is creating a significant external imbalance. The composition of trade will also remain under scrutiny as Washington examines potential transshipment through Thailand.
2. Thai stocks retreat below 1,600 as foreign selling intensifies
Thailand’s SET Index fell 11.62 points, or 0.73%, to 1,589.08 in Friday’s morning session, with trading value reaching THB40.83 billion. Large-cap names including DELTA, AOT and ADVANC came under pressure as investors reduced risk ahead of Federal Reserve Chair Kevin Warsh’s Jackson Hole speech.
Key figures: SET 1,589.08; foreign investors reportedly sold approximately THB5.4 billion in the previous session; technical support is around 1,595.
Why it matters: The retreat illustrates how quickly global monetary expectations can overwhelm Thailand’s improving export fundamentals. A stronger dollar and higher global bond yields are particularly important for Thai equities and the baht.
3. BOT keeps rate at 1% while Thailand balances growth and baht pressures
The Bank of Thailand maintained its policy rate at 1.00% on 26 August, with the MPC voting unanimously to hold. The decision comes as exports and tourism provide support but domestic growth remains relatively weak, while the central bank continues monitoring baht appreciation and financial-market conditions. (Bot)
Key indicators: Policy rate 1.00%; Thailand’s Q2 GDP growth was 1.9% year-on-year, down from 2.8% in Q1; July exports accelerated 21.6%.
Why it matters: The policy dilemma is becoming clearer: strong exports and a potentially resilient electronics cycle argue against aggressive easing, while weak domestic demand and the strong baht argue for easier financial conditions. The BOT’s management of the gold–baht relationship remains an important part of the FX story.
4. China factory activity expected to remain in contraction
China’s official manufacturing PMI is expected to edge up to 49.6 in August from 49.2 in July, according to a Reuters poll of 17 economists, remaining below the 50 threshold for a second consecutive month. Weak domestic demand, the property downturn and extreme weather are weighing on activity despite continued strength in technology-related exports. (Reuters)
Key figures: Q2 GDP growth 4.3%; July industrial output and retail sales slowed; Beijing has established an 800 billion yuan financing facility for local-government projects.
Why it matters: China’s domestic weakness remains a significant risk for ASEAN exporters, including Thailand. At the same time, China’s technology and manufacturing strength is helping sustain regional supply chains, creating a two-speed Asian economy.
5. South Korea’s AI chip boom keeps Asia’s export engine running
South Korean exports are expected to rise 62.6% year-on-year in August, according to a Reuters poll, extending the export-growth streak to 15 months. Semiconductors and AI-related memory demand remain the dominant drivers, although economists expect growth to moderate as favourable base effects fade. (Reuters)
Key figures: July exports +63%; August imports forecast +24.7%; expected trade surplus US$30.74 billion. Official August trade data are due 1 September.
Why it matters: South Korea is an important leading indicator for Thailand’s electronics sector. The continuing semiconductor boom reinforces the case that Thailand’s 21.6% July export growth is part of a broader Asian technology cycle rather than simply a temporary trade rebound.
Thailand–Asia market signal
Thailand: Strong export momentum is increasingly being offset by a widening trade deficit, foreign equity selling and baht/monetary-policy constraints.
Asia: The region remains split between AI-driven manufacturing strength and weak Chinese domestic demand. The next major market variable is the global rate outlook following the Jackson Hole signal, which is already strengthening the dollar and putting pressure on Asian currencies and equities. (Reuters)
