As labour unions protest against soaring energy prices, analysts warn the Thai economy faces higher stagflation risk as the new government has financial constraints. PATTARAPONG CHAPATTARASILLThailand faces a heightened risk of stagflation as elevated oil prices nudge up inflation, with the new government unlikely to launch large stimulus measures to prop up the subdued economy given high public debt levels, warn analysts. "However, we do not expect any large-scale fiscal stimulus to meaningfully boost the economy, given limited policy space," he said, citing a high public debt-to-GDP ratio. With inflation risks tilted to the upside due to higher oil prices, the Bank of Thailand faces a policy dilemma. Soaring global crude oil prices prompted the government to ease pressure on the Oil Fuel Fund and begin raising domestic fuel prices from mid-March.

Source: Bangkok Post April 06, 2026 22:53 UTC