Thailand
Thailand: Consumer mood sours for third consecutive month
The consumer confidence index tumbled to a six-month low in November on concerns about ebbing tourism revenue and falling crop prices, says the University of the Thai Chamber of Commerce.
The UTCC’s latest survey said the index fell for a third straight month to 80.5, down from October’s 81.3, September’s 82.3 and August’s 83.2.
Fewer Chinese arrivals hit revenue among tourism operators and related businesses, while falling crop prices, particularly for rubber and oil palm, have contributed to lower income for farm households, said Thanawat Phonvichai, director of the Center for Economic and Business Forecasting at the UTCC.
Despite price increases for certain crops such as rice paddy, corn and cassava, prices are still down from previous years, Mr Thanawat said.
The US-China trade row is another issue that could affect Thailand’s economic outlook and export growth, he said.
“The latest survey did not factor in a 90-day truce negotiated between China and the US, as well as how the number of inbound Chinese arrivals has begun to climb,” Mr Thanawat said.
Other factors that the survey did not account for include the government’s measures to address low prices for rubber and oil palm and the decline in crude oil prices.
“However, consumer purchasing power is generally concentrated in certain groups, with the result that many consumers still view economic conditions as murky,” Mr Thanawat said. “Observing November’s inflation data, headline inflation was less than 1% and core inflation was merely 0.7%.”
He said December’s consumer confidence index is likely to improve after the government issued a year-end economic stimulus package providing for a maximum 15,000-baht income tax deduction on purchases of tyres, books and One Tambon One Product (Otop) goods.
Taxpayers can claim a deduction on purchases of up to 15,000 baht in tyres, books and Otop products between Dec 15 and Jan 16.
Mr Thanawat said the value of consumer spending from the scheme is projected at 10 billion baht, while top-up via the government’s welfare smartcards for the poor should boost total consumer spending to 12-13 billion baht.
This would boost Thailand’s GDP growth by 0.2-0.3%, bringing this year’s figure to 4.2%, he said.
Lessened tension from the US-China trade row and improved Chinese arrivals to Thailand are also expected to enhance consumer confidence this month, he said.
Source: https://www.bangkokpost.com/business/news/1588934/consumer-mood-sours-for-third-consecutive-month