Bangkok:The economic impact on Thailand following the US midterm elections is being closely watched. Mr. Poj Aramwattananon, Chairman of the Thai Chamber of Commerce and the Federation of Thai Chambers of Commerce, congratulated the Democratic Party on its victory in securing a majority in both the House of Representatives and the Senate. He stated that this election result will lead to a better balance of power between the executive and legislative branches.
According to Thai News Agency, Kasikorn Research Center believes that while the Thai baht has the potential to appreciate, it forecasts the exchange rate to be 33.80 baht per dollar by the end of the year. Mr. Poj also mentioned that the US midterm elections reflect the will of the American people and are a significant development that the world is paying attention to, as the US plays a crucial role in the economy, trade, investment, and international security.
US President Donald Trump retains executive power within the legal framework, and it remains to be seen whether this change will lead to policy adjustments or compromises between the two parties. There is a possibility that the energy price situation may show positive signs if the political shift leads to diplomatic approaches to reduce tensions in the Middle East, particularly the conflict involving Iran. This could alleviate pressure on global oil prices, benefiting Thailand in terms of production costs and consumer purchasing power.
For Thailand, the United States is a key export market and a strategic trading partner. The Thai private sector must closely monitor developments in trade policy, including tariffs and trade fraud investigations. Deputy Prime Minister and Minister of Commerce, Supajee Suthamphan, stated that the results of the US midterm elections may force the US government to reconsider its trade policies, particularly regarding the cost of living and inflation.
Ongoing negotiations on a reciprocal trade agreement between Thailand and the United States confirm continued talks, with expectations that the US administration will maintain tariffs. Kasikorn Research Center estimates that the Democratic majority in Congress will limit the Trump administration's ability to push through new legislation, but core policies are likely to continue. Geopolitical and trade policy uncertainties remain significant risks.
The impact on the Thai economy includes risks from higher energy costs and US trade protectionist measures. However, there are opportunities to attract investment in industries such as electronics and data centers, depending on the global AI investment cycle. The election results may help reduce pressure on US and Thai bond yields, with the Thai baht's appreciation expected to be limited.