Thailand’s export growth likely contracted again in March

Thailand’s export growth is expected to have come in negative last month following an unexpected growth of 10.3% y/y in February, noted DBS Bank. Gold exports had warped the export data for February. According to consensus expectations, exports are likely to have contracted 5.1% in March, as compared with DBS Bank’s forecast of 2.6% contraction.

For three straight years, export growth has contracted. This trend is likely to continue this year too. Furthermore, manufactured goods’ exports also contracted, shrinking 5.5% in USD terms. Out of the total exports, manufactured goods account for 85%. This makes it very important for the overall export growth data.

Export growth in Thailand has been weighed on by weak global demand and stronger manufacturing growth in other nations in the region. Weak demand is dragging the manufacturing sector. The sector continues to suffer from overcapacity, with capacity utilization continuing to be much below the level seen in normal conditions. Capacity utilization print is not expected to indicate any considerable changes from the previous months, said DBS Bank.