Factory Output Rebounded, To Expand 0.8% In 2017

Economic Research	1 March 2017
Thailand
Economic Update
Factory Output Rebounded, To Expand 0.8% In 2017 Thailand’s manufacturing production index (MPI) grew 1.3% YoY in January, picking up from a flat reading the month before. The acceleration in growth was driven by better output for electronics & electrical (E&E) and vehicles & parts. Going forward, we maintain our projection for manufacturing production to expand at a faster pace of 0.8% this year, from +0.4% in 2016, on:     i.   Pick-up in semiconductor demand, as several smartphone manufacturers plan to launch flagship phones between 2Q and 3Q;    ii.   Increasing basic materials orders as the kingdom moves ahead with its infrastructure plans;   iii.   Higher food production on returning tourist arrivals and increased orders from China as the country is expected to improve food security in the face of US President Trump’s trade protectionism threats. Economist:  Ng Kee Chou  | +603 9280 2179