THAILAND: Bhumjaithai Withdrawal From Coalition Leaves Gov't w/Narrow Majority
The conservative Bhumjaithai party has withdrawn from PM Paetongtarn Shinawatra's governing coalition after bitter arguments regarding a cabinet reshuffle and in the wake of leaked audio of a call between the PM and president of the Cambodian Senate (and effective national leader) Hun Sen. Thailand and Cambodia have experienced tensions along their border following the death of a Cambodian soldier in May. The phone call took place on 15 June, after which Hun Sen posted the entire 17 minute conversation on his Facebook page.
- As Singapore's Business Times reports the PM told Hun Sen ".. her government was facing public criticism over the border issue and proposed a joint statement to resume normal crossings. Referring to him as “uncle,” she urged him to ignore “the opposite side,” a reference to the Thai military, and said its statements were unhelpful. She offered to “take care of whatever” he needed. The main opposition People’s Party said Paetongtarn had “completely lost” people’s confidence by painting the Thai army as the common enemy of Cambodian and Thai governments."
- The Bhumjaithai party, the second-largest in the coalition, had already threatened to withdraw from gov't after party leader Anutin Charnvirakul objected to the prospect of being moved on from the Interior Ministry in a reshuffle.
- While the gov't still holds a majority, this has been narrowed from a comfortable 72-seat margin to just three. As Bloomberg News reports, "That could complicate passage of key bills in July, including a controversial proposal to legalize casinos and the next fiscal year’s budget."
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US DATA: Leading Index Sees Sharpest Drop Since 2023 But Avoids Recession Signal
- The Conference Board’s Leading Economic Index (LEI) fell -1.0% M/M as expected in April after a downward revised -0.8% (initial -0.7) in March.
- The press release notes this is the “largest monthly decline since March 2023, when many feared the US was headed into recession, which did not ultimately materialize”.
- “Most components of the index deteriorated. Notably, consumers’ expectations have become continuously more pessimistic each month since January 2025, while the contribution of building permits and average working hours in manufacturing turned negative in April.”
- “Widespread weaknesses were also present when looking at six-month trends among the LEI’s components, resulting in a warning signal for growth. However, while the six-month growth rate of the LEI went deeper into negative territory, it did not fall enough to trigger the recession signal.”
- The Conference Board currently forecasts US real GDP growth of 1.6% in 2025 after 2.8% in 2024, “with the bulk of the impact of tariffs likely to hit the economy in Q3.”
