Thailand's factory output contracted in August, figures published on Tuesday showed and was weaker than forecast, as slowing exports, falling tourist numbers and a strong baht weighed on the economy.
Thailand's manufacturing production index (THMPI=ECI) fell 4.19% in August from a year earlier, the industry ministry said.
Negative factors included a weaker car industry and a decline in industrial sentiment, it said.
The figure compared with a forecast year-on-year decline of 2% in a Reuters poll, and followed an annual drop of 3.98% in July.
"The number is quite alarming, down 4.19% when compared to last year," Passakorn Chairat, the head of the ministry's industrial economics office, told a press conference.
The ministry's MPI forecast this year will be lowered from the current forecast of 0% to 0.5% growth, he added.
The factory output figures came as a new government pledged to revive the economy.
Thai exports grew 5.8% in August from a year earlier, the slowest pace in nearly a year due to the stronger baht and the impact of U.S. tariffs, according to the commerce ministry.
The United States set a 19% tariff on imported goods from Thailand, lower than the 36% rate announced earlier and in line with other countries in the region.
The commerce ministry aims to conclude a reciprocal tax agreement with the United States by the end of the year, Commerce Minister Suphajee Suthumpun told parliament late on Monday.
The ministry will also seek to expand trade in markets like Japan, Singapore, South Asia and the Middle East, and accelerate free trade agreement negotiations with the European Union and South Korea, Suphajee said.
Car production in Thailand, a regional auto making centre, dropped 6.1% in August from a year earlier, according to the Federation of Thai Industries.
Southeast Asia's second-largest economy is projected to expand by 1.8% to 2.3% this year, according to the state planning agency, and is expected to slow down sharply in the second of 2025 due to the impact of U.S. tariffs.
Last year's economic growth of 2.5% lagged peers.
