Thai consumer mood at 5-month high in July

Consumer confidence rose for a second straight month in July, reaching a five-month high, boosted by improved economic activity following an easing of Covid-19 curbs, but high cost of living remained a concern, a survey showed on Thursday.

The consumer index of the University of the Thai Chamber of Commerce (UTCC) increased to 42.4 in July from 41.6 in the previous month.

Consumer spending is likely to gradually improve later this year as the economy gains more steam, helped by increased exports and a recovery in the vital tourism sector, UTCC president Thanavath Phonvichai told a briefing on Thursday.

The economy is expected to grow 3.0% to 3.5% this year, with exports seen up 6% to 8% and foreign tourist arrivals expected at 8-10 million, he said.

There were nearly 40 million foreign tourists in 2019 before the Covid-19 pandemic.

The Bank of Thailand’s (BOT) first interest rate hike in nearly four years on Wednesday should not have a big impact on the economy as commercial banks will not rush to raise their interest rates, Mr Thanavath said.

The central bank is expected to raise the key rate by a quarter point at each of the two remaining meetings this year, taking the rate to 1.25%, he added. 

Meanwhile, the Finance Ministry said on Thursday that Thailand will sell 21 billion baht (US$594.40 million) of government savings bonds between Aug 22 and 24, 2022.