Business sentiment falls even further as woes pile up

The atmosphere at Yaowarat market in Bangkok's Chinatown during the annual vegetarian festival this year is subdued because of the pandemic. (Photo: Chanat Katanyu)

Thai consumer confidence picked up for the first time in seven months in September, but business sentiment slid further because of consumers' weak purchasing power, battered by the prolonged outbreak.

The University of the Thai Chamber of Commerce (UTCC) reported yesterday its consumer confidence index rose to 41.4 in September from 39.6 in August, which was the lowest level in almost 23 years.

Thanavath Phonvichai, UTCC president, said consumer confidence increased for the first time in seven months as a result of positive psychological factors.

Consumers felt less concerned about the spread of Covid-19 because of the rising rate of vaccinations, the relaxation of lockdown restrictions and increased domestic travel, said Mr Thanavath.

However, he said the index remained lower than 100 points, reflecting fragile purchasing power.

Mr Thanavath said three factors could undermine consumer confidence: the ongoing floods; rising diesel prices; and political uncertainty.

The university also released the TCC Confidence Index, which gauges the sentiment of the business sector by surveying members of the Thai Chamber of Commerce in every province.

The index dropped to 19.4 in September, the lowest in 33 months, from 19.8 in August.

He said business sentiment dropped in all regions because of the spread of the Delta variant; ongoing floods in the North, Northeast and Central regions that affected properties and crops; the high cost of living and product prices; rising prices of oil; and the overall economic slowdown.

Mr Thanavath said Thailand's pandemic is still lingering, which is affecting public purchasing power.

The business sector is not accessing soft loans, while the government has not issued new measures to stimulate the economy, he said.

According to Mr Thanavath, business operators expect purchasing power to continue to be limp because of high household debt, rising unemployment, and the ongoing absence of foreign tourists.

"We may wait and see about the election campaigns of tambon administrative organisations [TAO]. The campaigns are expected to help generate about 20-30 billion baht worth of spending, stimulating the economy during October and November," he said.

The Election Commission scheduled the election of TAO members for Nov 28, with the registration of candidates open from Oct 11-15.

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