Thailand consumer confidence rises for first time in eight months
Consumer confidence in Thailand saw its first improvement in eight months this October, driven by reduced concerns over recent floods and improved economic conditions influenced by government policies. The University of the Thai Chamber of Commerce (UTCC) reported a rise in the consumer confidence index to 56, up from 55.3 in September.
The consumer confidence index, which measures consumers’ outlook on the economy, remains below the 100-point threshold, indicating persistent weak confidence. This is attributed to the sluggish pace of economic recovery, rising living costs, elevated interest rates, and global geopolitical tensions impacting consumer spending power and willingness to spend.
Flooding across the country has subsided, and the government’s distribution of cash handouts has given consumers more capacity to spend, according to Thanavath Phonvichai, UTCC president. Nonetheless, concerns about the slow pace of economic recovery and high living costs continue to linger among consumers.
“The decreasing index reflects consumers’ declining confidence in the recovery of the Thai economy despite the government’s stimulus policies.”
Thanavath further indicated that sentiment could improve further if the government enacts additional stimulus measures by the end of the year.
In a related development, a separate UTCC survey involving chamber members nationwide showed a slight dip in confidence, with the index falling to 48.9 in October from 49.4 in September. This decline highlights ongoing consumer trepidation regarding overall economic conditions, including consumption, trade, investment, and tourism sectors.
Somchai Pornrattanacharoen, honorary advisor to the Thai Wholesale and Retail Trade Association, commented on the short-lived stimulus effect of the 10,000-baht cash handouts to vulnerable groups. Despite its potential to boost the retail sector, local shops have yet to witness a marked increase in sales, as some recipients may be opting to spend on non-essential items.
The UTCC has called on the government to bolster consumer confidence through additional economic initiatives. Recommendations include enhancing tourism at year’s end, developing workforce skills, providing financial support to small and medium-sized enterprises (SMEs), and enforcing stricter control over the influx of inexpensive and substandard goods from China. Maintaining the stability of the baht is also emphasised as a critical factor in fostering economic recovery.
As the year progresses, the interplay between government actions and consumer sentiment will be pivotal in steering Thailand’s economic trajectory. The UTCC remains attentive to these dynamics, advocating for policies that address both immediate consumer needs and long-term economic resilience, reported Bangkok Post.
What Other Media Are Saying
- Xinhua highlights Thailand’s first rise in consumer confidence in eight months, driven by improved flood conditions, interest rate cuts, and government measures, although spending caution persists due to high living costs. (read more)
- Bangkok Post reports a slight rise in Thailand’s consumer confidence due to government measures and interest cuts, yet concerns about slow recovery and high living costs persist, affecting spending behaviour. (read more)
Frequently Asked Questions
Here are some common questions asked about this news.
Why does consumer confidence in Thailand remain weak despite government policies?
Persistently high living costs, slow economic recovery, and geopolitical tensions undermine confidence despite policy efforts.
How might additional stimulus measures impact Thailand’s economic outlook?
They could enhance consumer spending power, potentially boosting economic recovery and confidence if effectively implemented.
What if Thailand’s government focuses more on tourism and SME support?
Targeted support could drive sector growth, improve employment, and stabilize consumer sentiment, fostering a more resilient economy.
How do global geopolitical tensions affect consumer confidence in Thailand?
They contribute to economic uncertainty, influencing consumer spending and willingness to invest due to perceived risks.
What role does the stability of the baht play in Thailand’s economic recovery?
A stable baht can enhance trade competitiveness, control inflation, and attract investment, crucial for economic recovery.
