Thailand: Manufacturing output slows in September
October 29, 2010
In September, manufacturing production expanded 8.1% over the same month last year, which was below the 8.4% increase (previously reported: +8.7% year-on-year) recorded in August, but beat market expectations of a 5.1% rise. The reading represented the slowest manufacturing output growth so far this year. The main drivers behind September's deceleration were a sharp fall in tobacco products output (August: +54.1% year-on-year; September: -18.4% yoy). In addition, production of petroleum products came in only at a fraction of the 10.6% expansion recorded in August, expanding only 1.1%. A month-on-month analysis, however, does not corroborate the deceleration suggested by the annual figures, as manufacturing production rose 3.44% over the previous month in seasonally adjusted terms, which contrasted the 3.49% contraction recorded in August. Moreover, the trend continued to improve, with the annual average growth in manufacturing output rising from 16.3% in August to 17.0% in September. The Central Bank has recently revised its growth forecast amid clear signs of robust fundamentals and now expects the economy to expand between 7.3% and 8.0% this year, up from its previous 6.5% - 7.5% estimate.
Author: Ricardo Aceves, Senior Economist