The Thai Industries Sentiment Index (TISI) dropped in July to 93.5 points on bearish exports and rising US-China trade war tensions, the Federation of Thai Industries (FTI) said on Thursday.
The index, based on a survey of 1,210 companies in 45 industries, fell from 94.5 points in June.
FTI chairman Supant Mongkolsuthree said businesses were concerned about lower purchasing orders and sales in overseas markets.
The cabinet on Tuesday had approved a 316-billion-baht economic stimulus package, but it would take time to beef up the country’s gross domestic product.
“Moreover, Thailand’s economy has suffered from widespread drought and local consumers are more careful about spending,” said Mr Supant.
“Business operators, especially SMEs, are also concerned about the increase in the minimum labour wage promised by the government.”
The FTI forecast is for the TISI to stand at 102.3 in the next three months, up from 101.3 points previously estimated on the expectation the government’s stimulus package will boost the economy in the fourth quarter, with increased local consumption and spending.
The FTI expects the government will speed up budget disbursements in the next three months.