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IMF: 2026 inflation up, growth down in Cambodia, Laos and Thailand; Vietnam speeds up

Published Data as of Southeast Asia (regional)Macro & households
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Key points

Implications for lenders

Where the IMF projects inflation above growth, as in Cambodia (5.6% against 3.0%) and Laos (9.2% against 4.5%), repayment capacity can weaken even if nominal incomes hold, so debt-service limits based on nominal pay may overstate what borrowers can carry. Collections teams in these markets may see more partial payments and requests to reschedule. In Vietnam, faster growth of 8.4% may support demand, but inflation above the official target can keep deposit costs, and therefore funding costs, elevated.

Implications

ExecutivesIn Cambodia and Laos, plan 2027 budgets on slower real income growth for borrowers, not on the 2025 pace.
InvestorsVietnam is the only Mekong market where the IMF sees faster growth in 2026; weigh that against inflation above the official target.
OperatorsRefresh affordability buffers for borrowers on fixed or slowly adjusting wages, especially in Laos.

Facts

Release: the International Monetary Fund published its October 2026 World Economic Outlook on 13 October, during the IMF–World Bank Annual Meetings in Bangkok. Its statistical appendix gives country projections for the five Mekong economies.

Growth (real GDP, annual change): Cambodia 3.0% in 2026, against 5.3% in 2025 1; Laos 4.5%, against 4.8% in 2025 2; Thailand 2.1%, against 2.4% in 2025 3; Vietnam 8.4%, against 8.0% in 2025 4; and Myanmar 2.0%, against −2.0% in 2025 5. For 2027 the IMF projects 4.0% for Cambodia, 4.5% for Laos, 2.1% for Thailand, 7.5% for Vietnam and 2.0% for Myanmar 6.

Inflation (consumer prices, annual average): Cambodia 5.6% in 2026, against 2.5% in 2025 7; Laos 9.2%, against 7.7% in 2025 8; Thailand 2.1%, against −0.1% in 2025 9; Vietnam 4.7%, against 3.3% in 2025 10; and Myanmar 20.0%, against 21.1% in 2025 11.

In its regional outlook two days later, the IMF said Cambodia's 2026 projection had been lowered by 1.0 percentage point 12.

Analysis

Compared with 2025, the pattern splits the region. Cambodia moves from 5.3% growth to 3.0%, the largest slowdown of the five, while average inflation rises from 2.5% to 5.6%. Laos slows only slightly, from 4.8%, but its inflation rises from 7.7% to 9.2%. In both, prices are projected to rise faster than output, a squeeze on real household income that a lender's affordability tests do not capture if they rely on nominal pay. Vietnam is the exception on growth, but its inflation projection of 4.7% is above the government's 2026 control target of 4.5% 13.

Against other forecasters, the IMF is the more cautious on prices in the two frontier markets. The ADB's September forecasts put 2026 inflation at 4.7% for Cambodia 14 and 8% for Laos 15, both below the IMF; for Thailand the ADB's 2.5% 16 is above the IMF's 2.1%. In Laos, the IMF figure is also well above the Bank of the Lao PDR's 2026 target of below 7% 17, which helps explain why the central bank is holding credit growth to 16% a year 18.

Counterpoints and uncertainties

These are projections made with data available by early October; the IMF, ADB and AMRO use different cut-off dates and assumptions, and Myanmar figures carry wide uncertainty. National statistics can diverge from the IMF's annual averages: Thailand's and Laos's monthly inflation already differ from the year-average path. Oil prices and the strength of the AI-driven export cycle could move all five forecasts in the same direction within months.

Key figures

  1. IMF real GDP growth projection, 2026 (WEO October 2026): 3.0% (against 5.3% in 2025). IMF projection of annual real GDP change for 2026, WEO October 2026, Table A4. Cambodia, whole economy. Basis date: 13 Oct 2026. Source: IMF World Economic Outlook, October 2026: Online Statistical Appendix Tables A4 (real GDP) and A7 (consumer prices)
  2. IMF real GDP growth projection, 2026 (WEO October 2026): 4.5% (against 4.8% in 2025). IMF projection of annual real GDP change for 2026, WEO October 2026, Table A4. Laos, whole economy. Basis date: 13 Oct 2026. Source: IMF World Economic Outlook, October 2026: Online Statistical Appendix Tables A4 (real GDP) and A7 (consumer prices)
  3. IMF real GDP growth projection, 2026 (WEO October 2026): 2.1% (against 2.4% in 2025). IMF projection of annual real GDP change for 2026, WEO October 2026, Table A4. Thailand, whole economy. Basis date: 13 Oct 2026. Source: IMF World Economic Outlook, October 2026: Online Statistical Appendix Tables A4 (real GDP) and A7 (consumer prices)
  4. IMF real GDP growth projection, 2026 (WEO October 2026): 8.4% (against 8.0% in 2025). IMF projection of annual real GDP change for 2026, WEO October 2026, Table A4. Vietnam, whole economy. Basis date: 13 Oct 2026. Source: IMF World Economic Outlook, October 2026: Online Statistical Appendix Tables A4 (real GDP) and A7 (consumer prices)
  5. IMF real GDP growth projection, 2026 (WEO October 2026): 2.0% (against −2.0% in 2025). IMF projection of annual real GDP change for 2026, WEO October 2026, Table A4. Myanmar, whole economy. Basis date: 13 Oct 2026. Source: IMF World Economic Outlook, October 2026: Online Statistical Appendix Tables A4 (real GDP) and A7 (consumer prices)
  6. IMF real GDP growth projection, 2027 (WEO October 2026): 7.5% (against 8.4% projected for 2026). IMF projection of annual real GDP change for 2027, WEO October 2026, Table A4. Vietnam, whole economy. Basis date: 13 Oct 2026. Source: IMF World Economic Outlook, October 2026: Online Statistical Appendix Tables A4 (real GDP) and A7 (consumer prices)
  7. IMF consumer price inflation projection, annual average, 2026 (WEO October 2026): 5.6% (against 2.5% in 2025). IMF projection of annual average consumer price change for 2026, WEO October 2026, Table A7. Cambodia, whole economy. Basis date: 13 Oct 2026. Source: IMF World Economic Outlook, October 2026: Online Statistical Appendix Tables A4 (real GDP) and A7 (consumer prices)
  8. IMF consumer price inflation projection, annual average, 2026 (WEO October 2026): 9.2% (against 7.7% in 2025). IMF projection of annual average consumer price change for 2026, WEO October 2026, Table A7. Laos, whole economy. Basis date: 13 Oct 2026. Source: IMF World Economic Outlook, October 2026: Online Statistical Appendix Tables A4 (real GDP) and A7 (consumer prices)
  9. IMF consumer price inflation projection, annual average, 2026 (WEO October 2026): 2.1% (against −0.1% in 2025). IMF projection of annual average consumer price change for 2026, WEO October 2026, Table A7. Thailand, whole economy. Basis date: 13 Oct 2026. Source: IMF World Economic Outlook, October 2026: Online Statistical Appendix Tables A4 (real GDP) and A7 (consumer prices)
  10. IMF consumer price inflation projection, annual average, 2026 (WEO October 2026): 4.7% (against 3.3% in 2025). IMF projection of annual average consumer price change for 2026, WEO October 2026, Table A7. Vietnam, whole economy. Basis date: 13 Oct 2026. Source: IMF World Economic Outlook, October 2026: Online Statistical Appendix Tables A4 (real GDP) and A7 (consumer prices)
  11. IMF consumer price inflation projection, annual average, 2026 (WEO October 2026): 20.0% (against 21.1% in 2025). IMF projection of annual average consumer price change for 2026, WEO October 2026, Table A7. Myanmar, whole economy. Basis date: 13 Oct 2026. Source: IMF World Economic Outlook, October 2026: Online Statistical Appendix Tables A4 (real GDP) and A7 (consumer prices)
  12. IMF downgrade to Cambodia's 2026 growth projection: 1.0 percentage point
    The report gives the size of the cut; the projected level for Cambodia is not stated in the sources.
    . Size of the cut to the IMF's 2026 real GDP growth projection for Cambodia in the October 2026 outlook. Cambodia. Basis date: 15 Oct 2026. Source: BusinessToday: IMF warns Asian central banks on inflation even as 2026 growth outlook rises (2026-10-15)
  13. Government inflation-control target 2026: 4.5%. Government ceiling for average 2026 inflation, as reported by Viet Nam News. National. Basis date: 30 Sep 2026. Source: Viet Nam News: Viet Nam rates likely to stay high until early 2027 (2026-09-30, citing SBV data)
  14. ADB consumer inflation forecast, 2026 (average): 4.7% (revised up from ADB's earlier projection)
    Value as reported by the Phnom Penh Post citing ADB; the earlier ADB value was not stated in that report.
    . ADB Asian Development Outlook September 2026 forecast, annual average. Whole economy. Basis date: 23 Sep 2026. Source: Phnom Penh Post: ADB cuts Cambodia's 2026 growth forecast to 3.9% amid tourism slowdown (2026-09-23)
  15. ADB consumer inflation forecast, 2026 (average): 8% (revised down from 9.8% (July 2026))
    July value from the Laotian Times report of the ADB July 2026 update.
    . ADB Asian Development Outlook September 2026 forecast, annual average. Whole economy. Basis date: 23 Sep 2026. Source: Xinhua: ADB forecasts stronger economic growth for Laos in 2027 (2026-09-23)
  16. ADB inflation forecast, 2026: 2.5% (revised down from 2.9%). ADB ADO September 2026 forecast of average consumer price inflation. Consumer prices. Basis date: 23 Sep 2026. Source: ADB: Developing Southeast Asia, Asian Development Outlook September 2026 (2026-09-23)
  17. BOL average inflation target, 2026: below 7%. Target for average 2026 inflation presented by the BOL to the National Assembly on 7 July 2026. Nationwide. Basis date: 7 Jul 2026. Source: KPL: Bank of Laos Prioritizes Five Measures to Keep 2026 Inflation Below 7 Percent (2026-07-07)
  18. BOL ceiling on annual credit growth: 16% (vs a current rate of 17.6% cited by the Governor)
    The Governor did not specify the basis of the 17.6% current rate (it differs from the 9.39% nine-month growth, which is measured over January–September).
    . Maximum annual credit growth the Bank of the Lao PDR Governor told the National Assembly the BOL will allow. Lao banking system. Basis date: 7 Oct 2026. Source: Vientiane Times: BOL takes tougher measures to curb inflation, strengthen kip (2026-10-08)

Sources

  1. IMF World Economic Outlook, October 2026: Online Statistical Appendix Tables A4 (real GDP) and A7 (consumer prices)primary
  2. IMF: World Economic Outlook, October 2026 — Resilience Under Strain, Urgent Choices (2026-10-13)primary
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