Thai Factory Sector Worsens in June as Output/Orders Fall Further amid Emergency Decree

Thailand manufacturing activity further declined in June amid the global trade recession and the extension of the emergency decree, said the private survey IHS Markit.

 

The Thailand Manufacturing Purchasing Managers’ Index(PMI) rose from 41.6 in May to 43.5 in June, its highest level in 3 months, but remained below the no-change 50.0 level, indicating a deterioration in the performance of the sector. Meanwhile, the average of PMI for the second quarter was at 40.6, the lowest recorded since the survey began in 2016.

 

IHS Markit stated that “a production volumes fell steeply again, in tandem with a sharp decline in new sales, led by a substantial fall in export orders. As a result, firms continued to cut back on purchasing activity and labour capacity. Business sentiment remained deeply negative while price pressures were subdued.”

 

In addition, the impact of the Covid-19 pandemic on the Thai factory sector still remained severe. Report said a production activity has been reducing in output for a fifth month running during June, with the rate of decline, believing a weakening sales trend as a key factor behind lower production.

 

Expectations about the upcoming year outlook remained deeply pessimistic, as shown by the Future Output Index slipping to the second-lowest in the survey history during June, said the survey.