The Office of Industrial Economics (OIE) has revised up its forecast of the country's manufacturing production index (MPI) after witnessing increased production in the industrial sector.
The OIE expects the MPI to grow by 2.5-3% throughout 2018, up from the earlier 1.5-2.5%.
Director Penwipa Trisiripanit said the two economic engines driving the MPI are export growth and a recovery in people's purchasing power.
But the OIE has kept its outlook for 2018 GDP growth at 2-3%, while the National Economic and Social Development Board sees a rise of 3.6-4.6%.
"The country's economy has shown good signs of recovery in line with the global economy, and as a result, demand for industrial products has increased and Thailand is also a production base for exporting many products to the global market," Mrs Penwipa said.
In related news, the OIE reported yesterday that the MPI index last month rose by 4.7% to 117.26 points compared with February 2017, marking an increase for 10 straight months.
The index was boosted by greater production of cars, petroleum, hard drives and plastic pellets.
The overall capacity utilisation rate was 70.4% in February.
Mrs Penwipa said the OIE expects the index in the first quarter to expand by 3.5-4%.
The office is also optimistic about the second quarter, forecasting car output to grow by 3.1% to 480,000 units because of favourable sentiment at home and in major export markets.
The electric and electronics industry is projected to grow by 1.5% during April to June, but home appliances are tipped for a 2.9% decline because the regional market for air conditioners has seen aggressive competition.
Even so, the OIE forecasts export value in the electric and electronics sector to grow by 4.9% to US$15.41 billion (480.6 billion baht) in the second quarter.
The country's iron and steel sector will grow by 4.4% in the second quarter, according to the OIE, which expects domestic iron and steel consumption to climb 4.5% to 4.42 million tonnes as the government's infrastructure plan gathers steam.
For the textile and garment industry, the OIE forecasts output to expand by 1.5% to 135,220 tonnes during the second quarter and for fabric production to increase by 4.2% to 133,270 tonnes.
Second-quarter garment output is expected to grow by 1.6% to 49,570 tonnes in line with expansion in trading countries like China, Japan and Vietnam.
The overall output of the food industry is forecast to grow by 3.3% in the quarter as food exports surge by 6.9%, driven by processed and frozen chicken products going out to both local and export markets.
