BANGKOK: Thai consumer confidence fell to a 14-month low in July, dented by slow economic growth, contracting exports and low commodity prices, a university survey showed on Thursday.
The consumer confidence index of the University of the Thai Chamber of Commerce dropped to 73.4 in July from 74.4 in June, its seventh consecutive monthly decline.
The reading was the lowest since May 2014, when the army seized power to end political unrest.
The university projected economic growth of 2.5%-2.9% this year but said expansion could quicken if the government undertakes short-term economic stimulus measures.
At present, there are no signs yet that the government will launch additional stimulus, but Prime Minister Prayuth Chan-ocha is coming under increasing political pressure to do something to boost an underperforming economy.
"If the government comes up with good short-term stimulus measures, consumer confidence may pick up in the fourth quarter," the university said.
The central bank said on Wednesday it will be trimming its forecast for 3% growth this year. In 2014, South-East Asia's second-largest economy expanded 0.9%.
More than a year after the coup, the military government has been unable to turn around a long-term decline in exports, while domestic demand has remained subdued.
Record high household debt levels have curbed private consumption, which makes up half the economy, while low commodity prices and a sharp drop in government subsidies have cut farmers' purchasing power.
Exports are likely to fall 4% this year, a third straight year of contraction, according to the Finance Ministry.
Thailand's monetary policy committee left the benchmark rate steady at 1.5% on Wednesday, saying the policy stance still supported the economy, with a weak baht a boost. The baht has weakened about 6.4% this year.
Kiatnakin Bank Pcl, one of Thailand's top auto loan providers, said this week it expected no loan growth this year after a 5% contraction in the first half.
Hopes that bad debts in the Thai financial system may have peaked this year are fading as more small companies and medium-sized enterprises default on their bank loans, hit by slowing domestic consumption and falling exports.
Chotima Chumchujan, a 25-year-old cosmetic marketer in Bangkok who hopes to eventually buy a condo near a train station, said that with the economy's weak state, "I haven't really been spending much. I will keep on saving money for now." - Reuters
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