Thailand Industrial Production Drops Most in 10 Years on Flooding

November 28, 2011
By

thailand flood

 

 

 

 

 

 

 

  • Thailand’s October industrial production index was released last night and fell 35.8% from a year earlier.
  • Consensus estimates were for a 15% drop.
  • The Office of Industrial Economics, in Thailand, said that the drop was the largest since at least 2000.
  • The Bank of Thailand has signaled additional rate cuts but interest rates will only help so much with normalizing the economic environment.
  • GDP growth for Thailand has been cut meaningfully.
  • It will be very important to watch the supply chain impact on the Japanese auto industry, disk drive production, and overall technology.
  • The flooding in Thailand is a humanitarian disaster and will also have a material impact on production for firms which manufacture in the flooded regions. Hopefully the crisis will abate quickly but some estimates are emerging that the impact could be as large as the Japanese tsunami and nuclear disaster’s impact.

 

 

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