THAILAND’S economy grew at the fastest pace in more than four years, led by a surge in farming output and tourism.

Gross domestic product rose 3.7% in the second quarter from a year ago after expanding 3.3% in the first quarter, the National Economic and Social Development Board said on Monday The median estimate of 21 economists surveyed by Bloomberg was for growth of 3.2%. GDP rose a seasonally adjusted 1.3% in the second quarter compared with the previous three months, higher than the 1% median estimate in a Bloomberg survey.

Thailand’s growth outlook has strengthened this year on the back of a recovery in global trade, but domestic demand continues to disappoint. More than three years after a military coup, political uncertainty has curbed the private sector’s appetite to invest, while consumer spending remains moderate.

At the same time, authorities are struggling to cap gains in the currency after it surged 7.9% against the dollar this year, undermining export competitiveness. The Bank of Thailand, which has kept its benchmark interest rate unchanged at 1.5% for more than two years, said last week the currency’s strength may hurt businesses. The bank has been reluctant to lower interest rates in the face of high consumer debt levels.

“Monetary conditions are accommodative to economic recovery,” said Roong Sanguanruang, a market analyst at Bank of Ayudhya Pcl in Bangkok, who expects the Bank of Thailand to remain on hold. “Given the latest impressive GDP growth number, we think the MPC will be comfortable with their stance. We don’t expect a rate hike before the middle of next year, but no rate cut.” We expect growth to remain relatively strong over the next couple of quarters, helped by strong external demand and loose monetary and fiscal policy,” said Gareth Leather, an economist at Capital Economics Ltd. in London. “The uncertain political situation is the main risk to the outlook.”

Agriculture surged 15.8% in the second quarter from a year earlier, up from 5.7% in the first quarter. Manufacturing growth slowed to 1% from 1.3%; construction contracted 6.2%. The hotel and restaurants sector climbed 7.5%; transport and storage rose 8.6%.

The Thai statistics agency revised its GDP growth forecast range for this year to 3.5-4% from 3.3-3.8%; the central bank projects growth of 3.5%.

Porametee Vimolsiri, secretary general for the statistics office, said the economy’s expansion was more broad-based than just tourism and exports; GDP growth is expected to accelerate in second half of the year, helped by exports. — Bloomberg