Thailand consumer confidence sails higher, defying global economic waves
Following a more stable political climate, consumer confidence in Thailand increased for the second consecutive month in September, notwithstanding global economic uncertainties. The consumer confidence index, as reported by the University of the Thai Chamber of Commerce (UTCC), rose to 58.7 in September from 56.9 in August, and 55.6 in July.
UTCC President, Thanavath Phonvichai, attributed this boost in confidence to the establishment of a new government and subsequent political stability. He projected further improvement in consumer confidence if the government successfully initiates stimulus policies to accelerate economic recovery.
Thanavath noted that the overall consumer confidence index still falls below 100, suggesting consumers’ perception of a sluggish economic recovery, high cost of living, and increasing interest rates both locally and internationally.
These factors, he explained, impinge on consumer expenditure, tourism, exports, general business operations, and job recruitment prospects, potentially diminishing consumer confidence presently and in the near future.
“Overall, consumers still have concerns about the global economic slowdown as well as interest rate hikes to address inflation in various countries. This may be a factor that adds pressure to the recovery of the global economy, potentially leading to a recession.
“This, in turn, has a negative impact on exports, causing a decline in exports during this period and negatively affecting people’s purchasing power in all regions.”
TCC Confidence Index
The UTCC also disclosed the TCC Confidence Index, which assesses the business sector sentiment and chamber member views across all provinces. The index witnessed a slight increase to 56.02 in September, a marginal rise from 56.00 for the consumer confidence index in the preceding month.
While businesses generally perceive a broad-based economic recovery and hold a largely positive future outlook, sectors heavily reliant on exports are perturbed by the uncertain global economic resurgence, according to Thanavath. He also revealed that business owners remain uneasy about ambiguous government policies, particularly the 10,000-baht digital wallet policy and the minimum wage hike, fearing these policy alterations could affect production costs.
In related news, the UTCC expected a dip in exports and a delay in state budget preparation and revised their economic growth forecast to 3%. This reflects the government’s aim of lowering the cost of living in Thailand. Read HERE to learn more!
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