Thai consumers’ confidence in the economy increased in December, with the University of the Thai Chamber of Commerce’s (UTCC) Consumer confidence index reaching 49.7. This was the seventh consecutive month of gain in the index, which has now reached its highest level in 25 months.
According to the UTCC’s Center for Economic and Business Forecasting (CEBF), Thai consumers view that the economy has started to improve due to activities in the tourism sector. Said activities positively influenced hiring and people’s income. The domestic COVID-19 situation has also been improving continually, while the prices of benzene fuels have declined significantly compared to the first half of 2022. These developments made the public feel more relaxed about the cost of living.
The CEBF reported that all categories within the Consumer Confidence Index (CCI) improved significantly. This is especially true for the sub-index on willingness to spend on tourism, which jumped to 65.7 to hit the highest level in 42 months. The cost of living index improved to 24.1, which is the best improvement in 31 years, albeit with consumers still indicating they feel that the cost of living is high.
The CEBF indicated its CCI is still moving at levels below 100 points as the cost of living remains high despite recent cost-of-living issues having been alleviated.
The CCI moved in line with the Thai Chamber of Commerce (TCC) Confidence Index, which reflects the views of businesses nationwide. The index improved for the 7th consecutive month in December to reach 45.5, the highest level in 3 years and 6 months. Nonetheless, TCC members expressed concerns over continually rising costs and potential new waves of COVID-19 outbreaks that could result from the influx of tourists.
UTCC President and CEBF chief advisor Thanavath Phonvichai gave his assessment that the Thai economy will perform near its normal level this year. He expects GDP to grow by 3.5-4%, with the higher end of the range viewed as being possible with momentum from Chinese tourists. Dr. Thanavath also noted the global economy did not become severely impacted by reduced inflation in the US and oil prices are currently not excessive. Thailand’s general election this year is also expected to be a boon to the economy. (NNT)