S&P Global Poised to Downgrade Thailand’s Credit Outlook Over Fiscal and Political Woes
Ministry of Finance expects November ‘Negative’ revision from S&P, following similar moves by Fitch and Moody’s due to political risk
- S&P Global is expected to revise Thailand's credit outlook to 'Negative' in its November assessment, following similar moves by Fitch and Moody's.
- The primary drivers for the potential downgrade are concerns over the country's volatile political landscape and its weakening fiscal capacity.
- Officials clarify this is a change to the outlook, not a full credit rating downgrade, and financial markets are not expected to be significantly impacted by the news.
Thailand’s Ministry of Finance anticipates that S&P Global Ratings will revise the country's credit rating outlook to 'Negative' during its assessment this November.
The expected shift is primarily driven by concerns over political risks and the diminished fiscal capacity available to the government.
Sources within the Ministry of Finance disclosed that S&P Global Ratings, the last of the three major agencies to deliver its verdict this year, is scheduled to announce its credit rating decision around November 2025.
S&P has already met with the Public Debt Management Office (PDMO) and reportedly expressed concerns regarding the direction of the country’s credit rating.
These concerns mirror the key issues previously cited by Fitch Ratings and Moody’s Ratings: namely, the volatile domestic political landscape and the weakening of Thailand’s fiscal space.
The official assessment suggests that S&P Global Ratings is likely to adjust Thailand’s outlook to Negative, consistent with the actions recently taken by its peers.
However, market experts believe this expected move will not trigger a shock in capital markets.
The sentiment is that the financial community has already absorbed the news since Moody’s, the first agency to make the revision, failed to significantly impact the local stock index.
Previously, Fitch Ratings lowered the Outlook on Thailand's Long-Term Foreign-Currency Issuer Default Rating from "Stable" to 'Negative,' though it affirmed the underlying credit rating at 'BBB+'.
Jindarat Viriyataveekul, the PDMO's spokesperson and public debt advisor, emphasised that a revision of the outlook to Negative does not constitute a full credit rating downgrade.
She highlighted that Thailand has successfully navigated similar outlook revisions from agencies in the past, eventually restoring the outlook to 'Stable'.
The essential factor in previous recoveries was the renewed growth of the Thai economy.
“We have continuously assessed risks and prepared accordingly. Furthermore, the market is already somewhat aware of this news, which is why it is not affecting the country today—a fact reflected by the stability of the Thai stock index,” Jindarat stated.
