Sentiment gauged to bounce back from August crater
Business sentiment fell to the lowest rate in 19 months in August on consumers' low purchasing power, a lack of financial liquidity and the trade row between the US and China.
Other negative factors weighing on sentiment included the baht's fluctuation and relatively low agricultural prices.
The Thai Chamber of Commerce (TCC) confidence index, a gauge of nationwide business sentiment, fell for a sixth straight month in August to 46.5 from 46.7 in July, 47.1 in June, 47.4 in May, 47.8 in April, 48.4 in March and 48.5 in February.
The TCC index sampled 369 chamber members nationwide, spanning the agriculture, industrial, trade and service sectors, during Aug 26-30.
Thanavath Phonvichai, vice-president for research at the University of the Thai Chamber of Commerce (UTCC), said overall business sentiment in all regions remained sapped in August. But he voiced hope that sentiment would start recovering in the remaining months of the year, boosted by the government's economic stimulus package and income guarantee scheme for farmers.
"The overall business sector believes that the economy passed the lowest point in the second quarter, when GDP growth was reported at 2.3%, the lowest in five years," Mr Thanavath said. "The farmers' income guarantee, the highlighted scheme, will indicate the Thai economic recovery because farmers' higher income from rice, rubber, oil palm, tapioca and corn will help boost the spending power of farmers."
Sauwanee Thairungroj, president of the UTCC, said the business sector urged the government to speed up implementing economic stimulus packages, introducing measures to prepare for natural disasters and upgrading the quality and competitiveness of agricultural products.
The government is also being encouraged to provide soft loans to businesses to increase financial liquidity and tech development.
Ms Sauwanee said the trade row and escalating political conflict between important trade partners India and Pakistan, as well as South Korea and Japan, in addition to the prolonged protests in Hong Kong, are key factors that will affect business sentiment during the rest of the year.