Thailand's manufacturing activity growth slowed to a 12-month low in May as consumer confidence remained fragile amid domestic and external pressures.
The headline S&P Global Thailand Manufacturing Purchasing Managers' Index (PMI) slipped to 52.6 from 52.7 in April, S&P Global reported Tuesday.
While the figure remains above the neutral 50 mark separating expansion from contraction, it represents the slowest pace of improvement since July 2025.
The slowdown was largely driven by sluggish output volumes, which expanded at their weakest rate in a year. Although new orders accelerated slightly compared with the prior month, firms noted persistent consumer hesitancy regarding spending.
According to a survey conducted by the University of the Thai Chamber of Commerce, the country's consumer confidence slumped to 50.6 in April from 51.8 in the previous month, the lowest in eight months.
Similarly, data provider Ipsos reported that consumer confidence in the first half of the year plunged to near-pandemic lows. The decline was driven by mounting economic pressures and geopolitical tensions, particularly the outbreak of war in Iran, which has disrupted global supply chains.
"Rising energy prices, cost-of-living concerns and declining confidence are changing consumer behavior in profound ways. As concerns shift, spending, saving and brand choices change as well. Businesses and brands must adapt quickly," said Pimtai Suwannasuk, Ipsos' senior client officer.
The Ipsos report, published in May, also highlighted that political corruption remains the absolute top concern among Thai consumers.
Consumers face even more pressure as manufacturers pass on elevated raw material and transportation costs, S&P Global noted. As a result, factory gate charges increased even as overall input cost inflation stabilized.
External uncertainties continued to strain business capacity, leading to a 10th consecutive month of backlog accumulation, yet manufacturers remain cautious about hiring additional staff.
Despite these headwinds, business owners are broadly optimistic, with 21% of survey respondents forecasting a rise in production over the coming year.
"There were some positive signals for the near-term outlook. Manufacturers anticipate a rise in their output levels during the year ahead, with confidence the highest since February," S&P Global Market Intelligence economic director Tim Moore said.
