Thai business confidence in September was eroded by growing concerns over the global economic slowdown and the country’s flood-hit manufacturing sector, according to the Bank of Thailand.
“This reflects the confidence of households and businesses, which expressed worries over the economic situation and demand in the country and abroad,” said the BOT’s report on monthly economic and monetary conditions in September.
The central bank’s business sentiment index (BSI) dropped to 48.5 points in September from 52.2 in the previous month. A reading above 50 indicates business confidence.
The expected BSI in the next three months, from October through December, declined to 50.6 in September from 55.5 a month earlier.
Expectations on inflation and costs continued to be sustained at high levels, the report said. The average inflation expectation was 3.9 per cent for the next 12 months. The August survey had produced a figure of 3.8 per cent.
Headline inflation started to fall, to 4.03 per cent in September from 4.29 per cent in the prior month, because of a decline in oil prices.
Core inflation continued its acceleration, rising to 2.92 per cent in September from 2.85 per cent in the previous month because of passthrough of prices of prepared foods and condiments.
Domestic consumption and tourism began to be affected by the severe flooding, resulting in lower expansion, the BOT report said.
September’s private consumption index dropped 1.6 per cent from the month before, while the number of international tourist arrivals fell to 1.5 million from 1.73 million in the same period. The occupancy rate at hotels dropped to 54.1 per cent in September from 57.1 per cent in August.
Exports grew at a slower pace of 18.4 per cent year on year to US$21.3 billion (Bt655 billion) in September, compared with the August level of 28.4 per cent, because of slower sales of especially electronic items to Europe and Japan.
Imports also saw slower expansion of 42.6 per cent to $18.8 billion, compared with the August rise of 45.9 per cent.
However, investment continued to expand. September’s private investment index stayed at 205.9, up 8.5 per cent from the same period last year.
The index fell slightly, by 0.3 per cent, from August.
Source: The Nation