Moody’s has revised its outlook on Thailand’s sovereign credit ratings to stable from negative, citing reduced external risks and balanced growth prospects. The credit rating agency kept Thailand’s long-term issuer and senior unsecured ratings unchanged at Baa1, along with affirming the short-term foreign currency commercial paper rating at P-2.
The revision to a stable outlook reflects Moody’s view that potential setbacks from US trade measures have eased. Recent reductions in US tariffs on Thai goods now place them on par with those for peer economies in the region, alleviating earlier concerns about a severe and lasting impact on Thailand’s exports.
Moody’s noted that, although elevated oil prices due to Middle East tensions are expected to put some pressure on Thailand’s economic expansion and government debt, these challenges are consistent with those faced by comparable sovereigns. Therefore, Thailand’s fiscal and growth performance is projected to align with other countries carrying a similar credit profile.
The agency also highlighted that a rebound in investment activity has lowered the likelihood of sustained underperformance in Thailand’s long-term growth trajectory. Additionally, the establishment of a ruling coalition with a strong parliamentary majority after the latest national elections has diminished risks of significant political instability and increased the chances of policy reform.
The agency rating in late April last year changed its Outlook on Thailand to “Negative” from “Stable,” while affirmed Sovereign Credit Rating at Baa1, citing the uncertainty regarding the U.S. trade tariffs that could dent Thai exports in the near term.
