Confidence to keep rising in 2013 if politics, global economy stable: UTCC
Consumer confidence should continue to improve into next year, barring domestic political conflicts or a global slowdown, according to the University of the Thai Chamber of Commerce.
“Consumer sentiment should see stable growth if there is no serious impact on their concerns,” Thanavath Phonvichai, director of the university’s Economic and Business Forecasting Centre, said yesterday. “Spending should grow steadily to the New Year’s celebrations and through Chinese New Year. The economy should grow by 4-5 per cent next year and by 5.5 per cent this year.”
Consumer spending should also increase, benefiting mainly the automobile, housing and travel industries and spurring investment, especially by small and medium-sized enterprises.
The Consumer Confidence Index in November climbed to its highest in 14 months since the serious flood last year to 79.1 points from 77.8 in October. All sub-indices related to confidence also rose.
The increase reflected the easing of political tensions after the Pitak Siam group called off its anti-government rally last month after one day without violence. The rally had stirred fears of renewed and prolonged political conflict.
Other positive factors included the recovery in exports in October, the spike in the SET Index and the Bank of Thailand’s decision to hold the policy rate.
However, consumers are still concerned that lower economic growth in light of the weakening global economy might crimp exports next year. Rising fuel prices, politics and unemployment are also risks. Consumers are afraid of layoffs after the spread nationwide of the Bt300 minimum wage next month, which could hit some businesses hard.
The opinion poll of 2,247 people found that consumers felt more confident about the domestic political situation. The political index edged up from 65.7 points in October to 69.2.
The index for new car purchases surged from 103.4 to 107.4 because of the better confidence as well as the government’s programme offering tax rebates to first-car buyers.
The rise in the index for new home purchases rose from 74.3 points to 76.8 points last month, for travelling from 95.6 to 99.3 and for new investment from 80.9 to 82.6.
Confidence in future income inched up from 95.3 to 96.8, while the index for future employment opportunities stepped up from 69.8 to 71.2.
