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12 Dec 2019

Thai Economy

3-Month Expected KR-ECI Fell to 27-Month Low in November amid Heightened Concern about Future Employment



      • The 3-month Expected KR-ECI slipped for the second consecutive month to 42.1 in November, representing the lowest level in 27 months and declining from 43.5 reported for October. The decline was attributable to heightened concern among Thai households towards income and employment over the next three months, in particular possible job cuts or layoffs without a prior notice.   
      • Meanwhile, the November KR-ECI came in at 42.0, increasingly slightly over 41.8 recorded in October because households were less anxious about domestic goods prices, especially foods and garments resulting partly from promotional campaigns of related entrepreneurs. Their concern about debt also declined, thanks in part to lending interest rate cuts by commercial banks after the Monetary Policy Committee trimmed its policy rate in early November. However, such an improvement will only be short term as households are still concerned about economic conditions and the cost of living over the long term.
      • KResearch views that households will experience increased risks from the fragile economy and cost of living in 1Q20, in particular uncertainties surrounding income and employment. As a result, household purchasing power and private consumption may slow down despite the daily minimum wage increases by THB 5-6, effective January 2020. Close attention must also be paid to drought during 1H20 because it may adversely affect farm income and drive up raw food prices in the country. 

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Thai Economy