Consumer confidence climbs to 7-month high
Consumer confidence rose for the third straight month in November, hitting a seven-month high driven by an easing of Covid-19 restrictions, robust export growth and the country’s reopening.
The University of the Thai Chamber of Commerce (UTCC) yesterday reported its consumer confidence index rose to 44.9 in November from 43.9 in October, 41.4 in September and 39.6 in August, which was the lowest level in almost 23 years.
Thanavath Phonvichai, UTCC's president, said people felt relief after the government gradually relaxed its lockdown restrictions and curfew measures and reopened the country to fully vaccinated foreign tourists on Nov 1. The expectation is that economic activities will now resume, he said.
The government’s diesel subsidy programme, which caps prices at less than 30 baht per litre, and economic stimulus measures, which have pumped more than 100 billion baht into the economy, also boosted consumer sentiment, said Mr Thanavath.
However, he said the index remained lower than 100 points, reflecting fragile purchasing power.
“The three-month uptick in consumer confidence reflects that consumers are feeling less concerned about the Covid-19 outbreak,” said Mr Thanavath. “Broader vaccinations helped establish consumer confidence and encouraged them to spend more and travel, particularly at the end of the year.”
He said the Thai economy is projected to gradually recover in the fourth quarter. The UTCC projected Thai economic growth of 1-1.5% this year, and an expansion of between 3.5-4.5% in 2022.
Mr Thanavath said consumers remain concerned about the new Omicron variant, as it may negatively impact the Thai economic recovery, purchasing power, tourism, exports, general business and future employment.
The university also released the results of the latest TCC Confidence Index, which gauges the sentiment of the business sector and members of the Thai Chamber of Commerce in all provinces nationwide. The index rose to 28.1, from 19.9 in October, driven by the easing of lockdown measures, lower infection rates, and falling daily death tolls, as well as rising numbers of vaccinations.
Other positive factors that boosted business confidence include the Monetary Policy Committee’s decision in September to maintain the benchmark interest rate at 0.5%, continuous export expansion, a rise in prices of agricultural products, and lower retail oil prices.
Mr Thanavath said all related parties needed to closely monitor Omicron infections in Thailand, saying the government may return to tougher lockdown measures if there is a serious spread of the new variant.