The relaxation of COVID-19 measures and the use of vaccination have led to improved consumer confidence. The University of the Thai Chamber of Commerce (UTCC) said the Consumer Confidence Index (ICC) in September rose for the first time in 7 months.
UTCC’s Center for Economic and Business Forecasting (CEBF) said the consumer confidence score rose to 48.9 in September from 46.7 in August, thanks to the easing of COVID-19 restrictions in 29 dark red provinces. The combined economic size of these provinces represents 80% of the national GDP.
As consumers and businesses now spend more money, CEBF has warned that the flood disaster and rising oil prices will have a negative psychological effect that will continue to prevent ITC from returning to the normal score of 100. This indicates a lack of consumer confidence. in the economy.
The CCI’s rebound contradicted views of the business sector, where the Thai Chamber of Commerce Confidence Index (TCC-CI) for the same period continued to decline for six consecutive months to 19.4.
The CEBF said this downward trajectory was due to the difficulties businesses have faced due to declining liquidity and weakening purchasing power, all caused by the COVID-19 pandemic and flooding.
The effects of these crises are most pronounced in the agricultural sector, while rising oil prices have also played a role.
UTCC President Thanawat Polvichai said the flood disaster, which is now affecting more provinces, will cause around 15 to 25 billion baht in damage.
He said rising oil prices should be watched closely, despite the decision to cap the maximum retail price of diesel at 30 baht per liter.
The center anticipates the improvement of the COVID-19 situation and funding for local election campaigns will help stimulate the economy for the remainder of this year, however, the government has yet to plan for additional economic measures, in order to achieve a annual economic growth between 1 and 1.5%. (NNT)