Commerzbank’s Thailand section notes May exports rose 10.6% year-on-year, below consensus and sharply slower than April’s 23.1%, with agriculture shipments weak but electronics still resilient. The government forecasts exports to grow 8% in 2026 as front-loading fades. In FX, USD/THB fell 0.2% to 33.35 on strong bond and equity inflows, though THB remains one of Asia’s weakest currencies.

Baht supported by portfolio flows

"Exports surprised to the downside, rising 10.6% yoy (Bloomberg consensus: 12.7%) vs 23.1% in April, the weakest in three months. The slowdown was driven by weaker agriculture shipments. It was offset by resilient electronics exports."

"Manufacturing exports remained firm, rising 14.4% yoy vs 27.5% in April, supported by AI-related demand. Electronics exports rose 32.5% vs 64.6% previously, marking an eighteenth consecutive month of double-digit growth."

"Agriculture exports contracted 3.1% yoy vs +17.9% in April, reflecting rising regional competition and tighter import restrictions from Indonesia which was imposed in late April. Fuel exports rose 24.2% vs 12.0% in April on elevated crude prices."

"Imports rose slightly below expectations, increasing 35.1% yoy (Bloomberg consensus: 36.3%) vs 45.0% in April. The May trade deficit narrowed to USD5.7bn (Bloomberg consensus: USD5.5bn) vs USD10bn."

"Thai government bond yields fell across the curve, led by the long end. The 2Y yield fell 1bps to 1.12% and the 10Y yield fell 4bp to 2.03%. The SET index gained 0.7% yesterday. THB remains the third-weakest performing Asian currency this year. Year-to-date, THB is down 5.5% vs the USD compared to the average for Asian currencies ex-Japan of -3.2%."

"In FX, USD/THB fell 0.2% to 33.35 yesterday, the first decline in seven sessions. This was driven by firm portfolio inflows as foreign investors recorded net purchase of USD42.9bn in bonds and USD19.8bn in equities."

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