Weekly Economic Review

Macroeconomic

Weekly Economic Review

18 November 2025

By Macroeconomic Team

Trump rolls back tariffs on key food products to help lower living cost. Chinese economy continues to weaken

US

Concerns over inflation remaining above the Fed’s 2% target reduce likelihood of policy rate cuts. The House of Representatives voted 222 to 209 to pass a temporary budget bill to end the government shutdown until January 30, 2026, with Republicans pledging to consider the healthcare legislation sought by Democrats at a later stage.

Although Congress managed to reach a budget deal that allowed government agencies to reopen, it only provides short-term funding to keep the government running until January 30. Ongoing political disputes could still trigger another government shutdown early next year. Meanwhile, key economic data—such as inflation, employment, and retail sales—to be released following the reopening of federal agencies, will provide clearer signals regarding the economic and monetary policy outlook. However, inflation trends remain a key focus after Trump ordered tariff exemptions on major agricultural and food imports—such as coffee, cocoa, bananas, and beef—to ease living costs and reduce political pressures. Current inflation stands at 3%, still above the Fed’s 2% target, diminishing the prospects of policy rate cuts.

Weekly Economic Review

Eurozone

Eurozone’s improving growth momentum may encourage the ECB to maintain policy rates. In November, the ZEW economic sentiment index rose to 25.0 from 22.7 in the previous month. Meanwhile, 3Q25 GDP grew 1.4% YoY, slightly above the market forecast of 1.3%. The September trade surplus also expanded to the highest level in six months, driven by stronger exports of chemicals, pharmaceuticals, and machinery.

Although eurozone growth is expected to remain modest, momentum could turn more positive next year, supported by (i) Germany’s fiscal stimulus measures, (ii) the impact of recent rate cuts and rising wages that should support consumption, and (iii) continued strength in the services sector. The manufacturing and export sectors may face pressure from U.S. tariff measures, but the negative impact could be less than that of other countries, as the tariff rate imposed on Europe—at 15%—remains lower than the global average. For these reasons, Krungsri Research expects the ECB to keep policy rates unchanged amid signs of economic recovery and inflation nearing the 2% target.

Weekly Economic Review

China

China’s key economic drivers have weakened, with retail sales of goods slowing for the fifth straight month to just 2.9% YoY in October. Industrial output grew at its slowest pace in a year, at 4.9%. Fixed asset investment contraction also accelerated from -0.5% in the first nine months to -1.7% in the first ten months. Meanwhile, new and second-hand home prices in October continued to decline, at -2.6% and -5.4%, respectively. Moreover, new household loans flipped back into decline at CNY -360.4 bn in October from CNY 389 bn in September.

The latest data signal a clearer economic slowdown. Although it was partly due to the long holiday, the slowdown reflects fragile economic fundamentals, even with stimulus measures such as trade-in and consumer loan interest subsidies. Meanwhile, the recent stock market recovery (with the CSI 300 index rising 19% since June) remains insufficient to offset the significant loss of consumer wealth during the property crisis. Therefore, consumers remain cautious with their spending. With weakening consumption, investment, and exports, there is a growing need for China to roll out further stimulus measures to sustain economic growth at levels comparable to recent periods.

Weekly Economic Review

The economy records its first quarter-on-quarter contraction in nearly three years in 3Q25, though it may avoid a technical recession in 4Q25

Thai 3Q25 GDP undershot expectations at +1.2% year-on-year (YoY) and -0.6% quarter-on-quarter (QoQ). Krungsri Research maintains full-year 2025 growth forecast at 2.1%. The NESDC reported that the Thai economy grew 1.2% YoY in 3Q25, below Krungsri Research’s forecast (1.4%) and the market consensus (1.6%), and down from 2.8% in 2Q25. The slowdown reflected (i) a deeper contraction in exports of services (–10.7% YoY); (ii) a slowdown in exports of goods (+10.8% vs +14.3% in 2Q25); and (iii) a contraction in both public investment (–5.3%) and government consumption (–3.9%) due to lower construction activity and budget disbursement delays. Private consumption continued to expand by +2.6%, but spending on services sector slowed down amid weaker tourism and softer consumer sentiment. Private investment growth was steady at +4.2%, while construction investment declined. The NESDC maintained 2025 GDP forecast at 2.0% and expected 1.2–2.2% (median 1.7%) growth in 2026.

3Q25 GDP came in below expectations, mainly due to (i) weaker government consumption and public investment amid heightened political uncertainty, (ii) a slower-than-expected tourism recovery, and (iii) temporary factors such as refinery maintenance shutdowns and temporary factory closures for relocation. Looking ahead, although earlier front-loaded export gains are fading and U.S. tariff hikes since August are starting to pressure manufacturing and trade, economic growth in 4Q25 is expected to improve. Clearer political direction, short-term stimulus measures—particularly the Half-Half Copayment Plus and Tourism Tax Incentive schemes—as well as a continued tourism recovery should support household spending and service activity, which would help the economy return to positive QoQ growth and avoid a technical recession. Krungsri Research maintains full-year 2025 GDP growth forecast at 2.1%.

Weekly Economic Review

Authorities have launched the “Clear Debt, Move Forward” program to ease small borrowers’ debt, though sluggish income growth remains the main household debt challenge. The Ministry of Finance, the BOT, and financial institutions have jointly launched a debt-resolution program through the purchase of small-scale non-performing loans (NPLs) by an Asset Management Company (AMC) under the initiative “Clear Debt, Move Forward.” The program targets unsecured NPLs with outstanding balances not exceeding THB 100,000 per borrower as of 30 September 2025. In its first phase, the scheme covers borrowers of commercial banks and their financial affiliates, totaling approximately 1.6 mn accounts, or 1.2 mn individuals, with combined debt of THB 43.6 bn. Sukhumvit Asset Management (SAM) will purchase these debts and restructure them under more flexible terms to help borrowers resume debt repayment.

Although this program can help ease the burden on small borrowers, slow income growth remains a major structural challenge underlying household debt problem. According to the latest survey by the National Statistical Office for 2021–2023, average household income increased by only THB 1,806 per year, nearly matching the annual rise in expenses of THB 1,803, leaving households with virtually no surplus for saving or debt repayment. The vulnerable groups are households earning less than THB 30,000 per month, which account for more than 69% of all households. In particular, incomes and expenses of households earning below THB 10,000 per month have both declined—indicating weakening purchasing power and deteriorating debt-servicing capacity. Going forward, addressing the household debt problem will require not only short-term relief measures but also efforts to raise household incomes and improve labor productivity over the longer term.

Weekly Economic Review

Announced :18 November 2025

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Weekly Economic Review

Macroeconomic