Bangkok - Thailand's manufacturing production index decreased by 0.36% in April from a year earlier, the industry ministry said on Thursday, registering a result below market expectations.
The April outcome contrasted with a Reuters poll that had projected a 0.2% year-on-year increase and followed March's performance, which the ministry revised to a 1.30% gain.
The ministry adjusted its forecast for annual factory output, now estimating a rise of 1.0% to 2.0% for the full year. That outlook is narrower and lower than the prior projection of a 1.5% to 2.5% gain.
According to the ministry, several factors contributed to the decline in output. It pointed to the impact of the war in the Middle East and to higher costs that placed pressure on corporate profits. The ministry also said tourism - a key driver of the economy - had weakened and that this softening had affected industries linked to the travel sector.
Despite the April contraction, manufacturing output for the first quarter expanded by 0.94% compared with the same quarter a year earlier, the ministry reported.
Looking ahead, the ministry indicated that the May reading should show an improvement on a month-on-month basis.
Implications for sectors
The ministry's release highlights immediate effects on the manufacturing sector itself and on industries connected to tourism. The statement also underscores cost pressures on producers that can affect corporate profitability.
Data note
All figures and assessments in this report reflect the industry ministry's statements: April production down 0.36% year-on-year; prior month revised to a 1.30% rise; first-quarter output up 0.94% year-on-year; full-year output forecast trimmed to a 1.0% to 2.0% increase; ministry attribution of causes to the war in the Middle East, higher costs, and weaker tourism; and a ministry remark that May should be higher on a month-on-month basis.