BANGKOK - Thailand's economy is projected to slow in the remainder of the year as US tariff policies hit exports amid global trade uncertainty, the central bank said on Wednesday.

Exports, a key driver of the nation's economic growth, are expected to shrink 4 percent on an annual basis in the latter half of 2025 and remain contracted by 2 percent in 2026 due to potential increases in tariffs on US imports, according to the Bank of Thailand (BOT).

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For the first five months of this year, the Southeast Asian country's exports rose 14.9 percent compared to a year earlier owing to front-loaded shipments, particularly industrial products, before the pause on US tariffs ended, commerce ministry data showed.

The Thai economy is expected to grow below its potential, with a forecast of 2.3 percent expansion in 2025 and 1.7 percent the following year, BOT Deputy Governor Piti Disyatat said at a press conference.

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The central bank flagged developments in trade negotiations, geopolitical conflicts, and domestic political uncertainty as downside risks that require close monitoring going forward.