Thailand’s NESDC forecasts a slowdown in the world’s two largest economies, citing rising import costs, labour shortages, and a downturn in electronics.
The world’s two largest economic engines, the United States and China, are set to enter a period of deceleration in 2026, according to the latest analysis from Thailand’s National Economic and Social Development Council (NESDC).
Reporting on the council’s findings, Wasawat Odthawee noted that following a year of intense trade disputes in 2025, global GDP growth is now predicted to soften to 2.8% in 2026, down from 3.2% last year.
Global trade volume is also expected to contract to 2.3%, a significant drop from the 3.4% expansion recorded in 2025.
US Economy: Tariffs and Labour Constraints
The American economy is projected to expand by 1.7% in 2026, a decline from the 1.9% seen in 2025. This cooling is largely attributed to the delayed impact of protectionist trade measures and tighter immigration policies.
As the “effective tariff rate” rises, domestic producers are expected to pass increased import costs on to consumers, reigniting inflationary pressures.
Furthermore, stricter immigration controls are likely to result in a “tight” labour market, causing potential staff shortages in the construction, logistics, and service sectors. Analysts suggest this may force the Federal Reserve to halt its programme of interest rate reductions.