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Thai consumer confidence index falls in November
[BANGKOK] Consumer confidence in Thailand fell in November, a university survey showed on Thursday, in spite of low inflation and moves by the military government to try to boost the economy.
The consumer confidence index of the University of the Thai Chamber of Commerce dropped to 79.4 in November from 80.1 in October.
The slip was the second since a bloodless army coup on May 22 ended months of political unrest. For September, the index was 79.2, compared with the previous month's 80.1.
"The economy has not fully recovered," Thanavath Phonvichai, an economics professor at the university that did the confidence survey, told a news conference. "Although oil prices are cheaper, people still feel that prices of good are expensive and living costs are high." Thai headline inflation fell to a five-year low of 1.26 per cent in November as oil prices weakened.
Sumontha Kaewkongkeaw, a 34-year-old housewife, said she isn't consuming more as she was not confident about the economy, adding "everything is very expensive".
Mr Thanavath said a subsidy the government will give to farmers to cope with rising costs has been delayed, so spending during December and January "should not be that active".
Consumption, which accounts for half of gross domestic product (GDP), could stay weak due to high household debt.
High debt is one reason the central bank has keep Thailand's low policy interest rate on hold.
Kasikorn Research Center, part of a bank, has predicted the rate will be cut at a monetary policy meeting on Dec. 17.
The junta, counting on infrastructure projects to help the economy, has cut the GDP growth outlook as badly-hit sectors such as tourism recover slowly.
Tourist arrivals rose in October from a year earlier - the first such increase since January - but there were 8.7 per cent fewer visitors in the first 10 months than 2013.
The confidence index began tumbling months before Thailand entered a period of political turmoil in late 2013.
Through April, the index fell 13 consecutive months before rising between May and August, reflecting improved confidence after the coup. But exports and domestic demand remain sluggish.
Southeast Asia's second-largest economy grew 0.6 per cent in July-September from a year earlier and only 0.2 per cent in the first nine months.
The state planning agency last month cut its 2014 economic growth estimate to one per cent from 1.5-2.0 per cent.