By Sucheera Pinijparakarn
The index, based on a survey last month, showed that households’ economic expectations for the next three months increased to 46.5 points, the highest figure in six months, said Kangana Chockpisansin, head of KReseach’s macroeconomic research department. The baseline is 50.
In August, the figure was 46 points, and 45 points in the July survey.
The increase suggests that the stimulus packages have contributed to a positive mood for household spending.
The sub-index on households’ income expectations for the next three months according to the September survey increased to 48 points, also the highest figure in six months. It compares with the August figure of 47.5 points and 47.3 points in July.
The sub-index on households’ debt-repayment expectations for the next three months rose to 46.2 points, up from 45.6 points in August.
Kangana cautioned, however, that the improvement in households’ confidence would not be dramatic because the ongoing drought is still affecting incomes of those in the agricultural sector. KResearch believes this sector will continue to need government help before its household incomes begin to rise.
Moreover, external factors, especially if China’s economy slows further, might delay Thailand’s economic recovery, she said.
The economic stimulus packages are the key reason KResearch in maintaining its growth forecast for Thailand’s gross domestic product this year at 2.8 per cent, said Pimonwan Mahujchariyawong, deputy managing director.
The stimulus packages are expected to drive GDP by 0.2 per cent, while the bright outlook for tourism this year will boost it by another 0.5 per cent. Both factors could help offset the drop in exports, she said.
Even though KResearch has maintained its GDP growth forecast, it has cut its export forecast from a decline of 1.7 per cent to a 5-per-cent slump this year.
Thanyalak Vacharachaisurapol, assistant managing director, said the overall level of household debt was expected to reach 82.5 per cent by the end of the year, up from 81.8 per cent as of the end of the third quarter. The stimulus measures for the property sector might boost household debt in the future.
The research house expects that the government’s measures will boost lending activities in the current quarter to Bt200 billion, better than the quarterly lending of Bt60 billion to Bt70 billion in the previous three quarters.
However, the subdued lending in the first nine months of the year prompted KResearch cut its forecast on loan growth in the commercial banking industry to 4 per cent from the previous expectation of 5 per cent, Thanyalak said.
The new target of 4 per cent, if realised, will be the lowest loan growth in six years for the commercial banking sector, she said.