Confidence hits '9-month high in June'
Easing political tensions and lower fuel prices boosted consumer confidence in June to the highest level in nine months, according to a survey by the University of the Thai Chamber of Commerce (UTCC).
The Consumer Confidence Index (CCI) rose to 78.6 points, compared with 77.1 in May. Related indices also increased, showing that consumers have improved sentiment on the country’s economic growth, though not yet in positive territory. Indices below 100 indicate weak confidence.
“Thai consumer confidence should increase steadily in the second half of the year because the political conflict has eased after the government withdrew its plan to push through its reconciliation programme. The Thai economy is in good shape and should not suffer severe impacts from external factors if the political situation is stable,” UTCC president Saowanee Thairungroj said yesterday.
The overall improvement in the CCI last month was attributed mainly to lower global and domestic oil prices, growth of Thai exports in May, a rising SET Index, an unchanged policy rate, and the raising of the Fiscal Policy Office’s 2012 GDP growth target to 5.7 per cent.
Still, negative factors could damage consumer confidence in the remaining months of the year, mainly political conflict and the financial crunch in the euro zone, which could affect exports, Saowanee pointed out.
The UTCC expects exports will grow by 10 per cent this year, lower than the Commerce Ministry’s target at 15 per cent.
However, Saowanee believes that the euro crunch will have only a small impact on Thai consumer confidence and growth in gross domestic product, as the Kingdom has strong financial fundamentals and relies little on investment in th e European Union.
The serious attempts of the EU countries to help minimise the impact of the current crisis should also help ensure that the debt problems there will be brought under control.
The survey polled 2,232 respondents, and found that people had better sentiment to spend their money on cars, houses, travel, and new investments.
The UTCC poll also showed that confidence in future income grew from 96.1 points in May to 97.8 in June. The index on future employment opportunities rose from 68.1points to 69.6.
