InnovestX Analyzes Global and Thai Economic Outlook for Q2/2025 Global Economy at a Turning Point as China Recovers; Thailand Faces More Pressure from U.S. Tariffs than from Earthquakes

•  Diversification Recommended — Focus on Defensive and High-Potential International Stocks

InnovestX Securities, the investment flagship of SCBX Group, has released its Q2/2025 economic and investment strategy under the theme “Reversal of Fortune – Shifting Winds.” The report highlights a global turning point: the U.S. economy is slowing, China is rebounding from aggressive stimulus, and Europe is stabilizing. InnovestX warns of rising risks of mild stagflation—slower growth with persistent inflation—and expects continued volatility in global markets, especially amid shifting U.S. trade policy. Citing external pressures on Thailand’s economy, InnovestX has lowered its SET Index target to 1,350, down from 1,550. Still, the firm sees a potential rebound in Q2, supported by attractive valuations and expected government measures. Investors are advised to diversify across regions and sectors, focusing on defensive stocks with strong domestic earnings and growth sectors abroad, such as AI and clean energy. Regarding the March 28 earthquake, InnovestX expects a short-term tourism impact, with revenue losses of 10–15% over two weeks. Recovery is likely within a month. The GDP growth forecast remains at 2.5%, with no major infrastructure damage. The firm sees U.S. Reciprocal Tariffs as a greater risk to Thailand’s economy than natural disasters.

Mr. Sutthichai Kumworachai, Head of Investment Strategy at InnovestX Securities, stated, “In Q2/2025, the global economy is undergoing a major transition. The U.S. is facing mounting pressure from trade policies under President Donald Trump, particularly new import tariffs, which are weighing on consumer confidence and the labor market—adding pressure to global equities, including U.S. markets. Meanwhile, China is showing clearer signs of recovery, driven by aggressive stimulus measures. The Chinese government has set a 5% GDP growth target and is issuing long-term special bonds to support the economy. In the EU, recovery is likely as geopolitical uncertainty starts to ease. However, the Thai economy continues to face external headwinds, including tight financial conditions and potential impacts from U.S. tariffs. Still, with Thai equities having declined to more attractive levels, we see potential for a market rebound in Q2/2025.”

Dr. Piyasak Manason, Head of Economic Research at InnovestX Securities, stated, “The global economy is at risk of mild stagflation—slower growth alongside inflation that remains above target. The U.S. Federal Reserve is expected to face policy challenges, with only a single 0.25% rate cut likely in 2025. The IMF is also expected to downgrade its global growth outlook soon, as global PMI has dropped to a one-year low. Still, the U.S. economy remains fundamentally resilient, suggesting a low risk of recession. In China, while debt and property concerns persist, the government continues to roll out stimulus—focusing on infrastructure and key sectors such as AI and electric vehicles. One major risk for Thailand is the potential enforcement of U.S. Reciprocal Tariffs, which could lower the country’s 2025 GDP growth from 2.5% to around 2.0% or below.”