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🇹🇭 Thailand /Economy & Trade

Consumers optimistic as businesses remain cautious in Thailand

From Bangkok Post · () English

Translated from English, summarized and contextualized by DistantNews.

At a glance

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  • Consumer confidence in Thailand rose in June for the first time in four months, supported by lower fuel prices and a government co-payment scheme.
  • Business confidence, however, declined, with operators citing rising operating costs and sluggish trade as concerns.
  • The University of the Thai Chamber of Commerce (UTCC) noted a divergence between consumer optimism and business caution, highlighting differing economic perceptions.

Thai consumer confidence rebounded in June, marking the first increase in four months, driven by falling fuel prices and the government's "Thai Chuay Thai Plus" co-payment scheme. The consumer confidence index (CCI) reached 50.7, according to the University of the Thai Chamber of Commerce (UTCC).

The mismatch between the rising CCI and declining TCC-CI in June highlighted differing economic perceptions among consumers and business operators.

— Thanavath PhonvichaiExplaining the contrasting economic outlooks between consumers and businesses.

This consumer optimism contrasts sharply with business sentiment. The Thai Chamber of Commerce confidence index (TCC-CI), which surveys business operators nationwide, fell to 41.4. This decline reflects ongoing concerns about rising operating costs, sluggish border trade, and weak foreign tourist arrivals.

For consumers, stimulus measures, particularly the co-payment scheme, have injected money into the economy and increased purchasing power.

— Thanavath PhonvichaiDescribing the positive impact of government initiatives on consumer spending.

Thanavath Phonvichai, president of the UTCC, pointed out this divergence, stating that while consumers feel the impact of stimulus measures and easing global tensions, businesses remain cautious. Operators are waiting for clearer signs of economic recovery, such as a resolution to the Middle East conflict.

In contrast, despite the government's 50-billion-baht injection through the co-payment scheme, business operators believe the support has been inadequate to offset rising operating costs.

— Thanavath PhonvichaiDetailing the concerns of business operators regarding the effectiveness of stimulus measures.

Phonvichai explained that the co-payment scheme, initially seen as "extra money" by consumers in a previous iteration, is now viewed as essential financial relief to cope with the higher cost of living. He anticipates that consumer spending power could recover by the end of the third quarter if key conditions, including a ceasefire in the Middle East and government support for energy pricing, are met.

If a permanent ceasefire is achieved, the Thai government addresses the energy pricing structure, and stimulus measures continue, consumer spending power should recover by the end of the third quarter.

— Thanavath PhonvichaiOutlining the conditions for a potential recovery in consumer spending.
DistantNews Editorial

Originally published by Bangkok Post in English. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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