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15 Oct 2021


Retail sales in 4Q21 signals post-lockdown recovery amid cautious spending (Current Issue No.3278)


KResearch views that the COVID-19 situation and vaccine accessibility have improved to the point that the government has eased many lockdown measures, allowing more economic activities to resume operations in the final quarter of 2021. Since many businesses are expected to launch campaigns to boost spending during the period, retail sales in 4Q21 should grow 1.4 percent YoY, contrary to the 1.2-percent contraction in the previous year (the projection took into account the possibility that the Thai government will issue additional stimulus packages). Such growth is expected to be primarily driven by spending in December, in preparation for the new year.

Although there are signs of improvement regarding the current outbreak in Thailand, consumers remain concerned about their own safety and weakened purchasing power. As a result, people are generally inclined to spend cautiously, particularly on essential goods like food and beverages, as well as personal care products. Meanwhile, non-essential items like clothes and shoes will likely see a contraction in the final quarter of the year. However, sales of furniture, home accessories and alcoholic beverages may increase slightly in 4Q21 compared to the same period of last year. That said, overall sales are expected to shrink continuously in comparison to 2020.

KResearch views that the extent of retail sales recovery over the remainder of this year and into 2022 will be dependent upon the effectiveness of COVID-19 management and the return of foreign tourists. At the same time, retailers will still face challenges stemming from fierce competition and customers' fragile purchasing power amid the rising cost of living.​