Consumers’ confidence index for July dropped to 73.9 points – the lowest in seven months and the third month in a row – as consumers were concerned with the flooding in the Northeast.
Thanawat Pholvichai, director of Economic and Business Forecast Center of the University of Thai Chamber of Commerce, said Tuesday (Aug 8) that the prices of farm produce for July, although slightly increased, remains low, rendering low purchasing power among rural people who doubt that the Thai economy is not recovering as anticipated.
Mr Thanawat noted that confidence index toward the economy in general for the month of July dropped to 62.2 points from 63.3 points in June whereas confidence index toward job opportunities dropped to 69.1 points in July from 70.0 points in June. Confidence index in future revenue also dropped to 90.4 from 91.5 in June.
He said that one of the factors contributing to the decline in confidence indices for three months in a row stemmed from public concern over flooding which also affected purchasing power of the grassroot people.
Middle-income and grassroot consumers now feel that the economy is not recovering yet – a view which is in contrast with the macro-economic view of clear sign of economic recovery.
Thanawat urged the government to accelerate government sector’s expenditure to help stimulate grassroot economy and to increase the people’s purchasing power.
As for flooding in the Northeast, he said the center had estimated the flood-induced damage at about 9.5 billion baht which was broken down into: 4.7 billion baht in farming and livestock sectors; 3.4 billion baht in business and industrial sectors and 1.3 billion baht in infrastructure such as roads, bridges and cars.
The center also conducted an opinion survey among 1,229 respondents about their spending habit during the long weekend this week which coincides with the Mother’s Day on August 12.
The center predicted spending bill during the long weekend this week to be at about 13 billion baht – an increase of 2.7 percent over the same period last year.