Consumer confidence dipped for the first time in seven months in April on concerns that the strong baht may derail export growth.
Thanavath Phonvichai, vice-president for research and a director of the University of the Thai Chamber of Commerce, warned Thailand's gross domestic product could slip below 5% if the government fails to come up with immediate measures to stimulate domestic purchasing power and rein in the foreign exchange.
The consumer confidence index dropped to 83.7 points last month from 84.8 in March, 84 in February and 81.7 in January.
The overall economic index came in at 73.9 points, down from 75 in March, while the index for job opportunities registered at 75.5, down from 76.4.
The index on future income declined to 101.8 points from 102.9.
A score of less than 100 points indicates pessimistic among consumers, while a reading above 100 means they expect conditions will improve.
"Consumers' concerns over the baht appreciation are growing, as they fear that a continued strong baht may adversely affect the country's export performance, tourism and the overall economy," he said.
"This will eventually hit extra income of workers in the export industry."
People are increasingly worried about the farm price outlook, particularly for rubber and palm nuts after prices of these products dropped by more than 20% year-on-year, said Mr Thanavath.
More importantly, people are concerned about political instability, as the government seems committed to moving ahead with its amnesty bill.
Mr Thanavath warned that slower inflation for a fourth straight month in April reflected lower purchasing power and slower economic growth.
Commerce Ministry figures showed consumer prices rising by 2.4% year-on-year last month against 2.7% in March, 3.2% in February, 3.4% in January and 3.6% in December.
The December rate was the highest since November 2011.
Core inflation, which excludes fresh food and fuel costs and is based on 312 products and services, was 1.2% in April, within the central bank's target range of 0.5% to 3%.
For the first four months of this year, annual inflation was 2.9%, a level the Commerce Ministry says is consistent with expanding consumption.