Consumer sentiment picked up for the first time in 15 months in May, boosted by lockdown easing, government relief efforts and an economic stimulus programme.
The University of the Thai Chamber of Commerce (UTCC) said on Thursday that the consumer confidence index rose to 48.2 in May from 47.2 in April.
"Higher consumer confidence stems largely from the government's declaration to ease the first and second stages of lockdown measures and financial relief programmes for the fallout," said Thanavath Phonvichai, president of the UTCC. "Overall, consumers and entrepreneurs are still concerned about rising unemployment and future income in light of the economic recession."
Mr Thanavath said the survey found that people believe the economy is likely to recover in the fourth quarter this year, with the lowest point having occurred in May.
The university forecasts the economy to plunge by 10% in the second quarter and 3.5-5% for the full year, assuming no second wave of coronavirus infections or domestic political turmoil.
"In the third quarter, the government should inject at least 200 billion baht to increase employment at the local level and accelerate the allocation of soft loans to help small and medium-sized entrepreneurs," Mr Thanavath said. "The UTCC forecasts the economy to shrink by as much as 8.8% if the government does not use stimulus measures."
Mr Thanavath said the first stage of the easing of lockdown measures is estimated to raise 2-3 billion baht per day or 60-90 billion baht per month in circular flow, while the second stage will see circulation rise to 6-8 billion per day.
"The turning point for the economy will be based on how fast businesses can bounce back," Mr Thanavath said. "Consumer spending was normally about 20 billion baht per day, and in the midst of lockdown measures about 10 billion baht per day or 300 billion baht per month is estimated to have disappeared."