Confidence among Thai consumers in August plunged to its lowest level in nine months as the domestic political situation, the higher cost of living and a volatile global economy tempered Thailand’s economic outlook.
Thanawat Phonwichai, director of the Centre for Economic and Business Forecasting at the University of the Thai Chamber of Commerce, said today that the Consumer Confidence Index (CCI) decreased for the fifth consecutive month in August to 79.3 – a drop from 80.3 in July and the worst since December.
The economic outlook is rather grim given the unstable political situation, the skyrocketing cost of living, higher priced cooking gas, expressway fees and electricity, and global economic volatility linked to the violence in Syria, he said.
Predicting reduced consumption and increased household debt in the fourth quarter, he called on the government to speed up budget spending, stimulate border trade and tourism.
He said the Centre for Economic and Business Forecasting would lower the country’s economic growth from 4.0-4.5 per cent to 3.5-4.0 per cent, probably late this month.
Mr Thanawat said rubber farmers’ continued protests and the road blockade in the South have affected several business sectors and the damage was preliminarily estimated at Bt100-200 million a day.
If the government fails to end the conflict in a month, it would affect the overall economic growth by 0.1 per cent and the protests could possibly escalate to a political conflict, he said.