BNP Paribas explains that Thailand shifted from broad price freezes to targeted subsidies for vulnerable households and firms. While subsidies slow fiscal consolidation, Thailand’s government debt is mostly in local currency and held by residents, with a low interest burden, making it the least exposed among peers to a potential rise in US long-term interest rates.

Selective support and robust debt structure

"Meanwhile, Thailand, after leaving its prices unchanged in the early weeks of the conflict, has ultimately decided to target only the most vulnerable households and businesses by providing them with partial direct subsidies."

"India, like Indonesia, Malaysia and Thailand, has the capacity to absorb this new shock to its public finances."

"The country whose government is least exposed to these risks is Thailand, as its debt (64.2% of GDP) is almost exclusively denominated in domestic currency and held by residents, whilst its interest burden is low (6% of revenue)."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)