Thailand's economy accelerated in the first quarter, driven by growth in manufacturing and exports, alongside government fiscal stimulus that helped cushion the fallout from ongoing Middle East tensions.
First-quarter GDP expanded 2.8% year on year, faster than the 2.5% rise in the fourth quarter of 2025, according to Monday data from the National Economic and Social Development Council.
The latest print beat the market consensus of 2.4%, as well as the 2.2% growth forecast by ANZ and analysts surveyed by Reuters.
"A key driver was an expansion in manufacturing," the NESDC said. "On the expenditure side, private final consumption expenditure continued to expand at a satisfactory pace, while government final consumption expenditure, gross fixed capital formation, and exports of goods and services accelerated."
By sector, agricultural growth doubled to 1.2% from 0.6% in the previous quarter, while the non-agricultural sector expanded by 3%, accelerating from a 2.7% gain in the prior quarter. Within this segment, industrial growth doubled to 1.8% from 0.9%, while the services sector ticked up to 3.6% from 3.5%.
Private final consumption expenditure rose 3.2%, supported by steady spending on semi-durable and non-durable goods.
Public investment was another major driver for growth, following the government's approval of an emergency decree to borrow 400 billion Thai baht to cushion the economy against the macroeconomic impact of the U.S.-Iran conflict.
As a result, general government final consumption spending climbed 3.4% on increased purchases of goods and services as well as social transfers in kind, the NESDC noted.
Moreover, gross fixed capital formation expanded 9.9%, faster than the prior quarter's 8.1% increase.
"This pick-up is consistent with foreign investment in data centers and EV production," ANZ's analysts, Chief Economist Sanjay Mathur and FX Analyst Kausani Basak, said in a note. "We also believe that government policies, including the government's Fast Pass initiative, have played a supportive role."
ANZ expects the government to introduce a new stimulus spending of 200 billion baht, along with the co-payment scheme, where the government will contribute 60% of approved consumer spending.
"Looking ahead, private consumption is expected to be supported by the co-payment scheme, which is set to begin in June," Mathur and Basak said. "The low-income households will benefit most from the scheme, although elevated prices may limit its effectiveness.
ANZ raised its 2026 GDP growth outlook for Thailand to 2.4% from 1.6%.
