Thailand: Consumer confidence up for fifth month in a row

Consumer confidence increased for the fifth straight month in October, hitting a 10-month high, boosted by strong exports, a recovery in tourism and the easing of the pandemic.

The University of the Thai Chamber of Commerce (UTCC) reported on Thursday the consumer confidence index rose to 46.1 in October from 44.6 in September, 43.7 in August, 42.4 in July and 41.6 in June.

It stood at 40.2 in May, 40.7 in April, 42 in March, 43.3 in February and 44.8 in January.

An index lower than 100 points reflects weak purchasing power based on a slow economic recovery.

Thanavath Phonvichai, president of the UTCC, said consumers felt the economy was recovering following the improvement in Covid-19 infections and the easing of pandemic curbs.

The improving economy and the relaxation of Covid-19 control measures resulted in a resumption of business activities and higher foreign tourist arrivals.

However, he said consumers remain concerned about the rising cost of living driven by relatively high oil prices because of the Russia-Ukraine war and the hike in interest rates to tame inflation around the world.

“Despite a spate of risk factors, the economy has recovered. The UTCC forecast GDP growth of 3.3-3.5% this year and 3.5-4% in 2023,” said Mr Thanavath.

“In 2023, the economy is expected to return to normal, boosting consumer sentiment accordingly. We expect the economy to start clearly recovering in the second quarter of next year, driving consumer confidence to see clear signs of recovery by the middle of next year.”

He said consumers still remain cautious about spending.

If the government relaunches stimulus packages such as the “Shop Dee Mee Khuen” tax rebate scheme and the “Rao Tiew Duay Kan” (We Travel Together) scheme, there is a chance it can increase economic activities and promote economic recovery in the fourth quarter of 2022, said Mr Thanavath.

“After more active spending during the Loy Krathong festival, we see clearer signs of a recovery in the country’s economy and consumer sentiment,” he said.

“We expect continued spending during the upcoming World Cup will help drive economic growth momentum through the end of the year.”

On Wednesday, the UTCC estimated 18.5 billion baht would be spent during the 32-day football tournament scheduled to take place in Qatar from Nov 20 to Dec 18.

The figure represents a 3.7% increase over the amount spent during the 2018 World Cup, which was held in Russia, and a surge of 22% over the total amount spent during the UEFA Euro 2020 tournament.