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7 Sep 2022

Thai Economy

KR-ECI recovered for two straight months in August 2022, supported by higher employment and the fact that prices of several products began to increase at a slower rate from the previous month


  • In August 2022, the KR-ECI and 3-Month Expected KR-ECI increased to 33.9 and 35.7, from the 32.5 and 34.0 reported for July 2022, albeit lower than 50, as households were generally optimistic towards income and employment after economic activity, particularly tourism has gradually bounced back. Additionally, the KR-ECI was supported by the fact that prices of several products began to increase at a slower rate from that recorded in July 2022. Some Thais also began to sign up for the fifth phase of the co-payment program (effective from September 1 to October 31, 2022). Having considered various components of the 3-Month Expected KR-ECI, it has been found that households are more concerned about higher energy, utility and basic service costs, suggesting that the rebound in the KR-ECI may remain fragile and that the rising cost of living will continue to pressure confidence of some households towards spending.  
  • Another survey conducted by KResearch on the fifth phase of the co-payment scheme, effective from September 1 to October 31, 2022, shows that more than 87 percent of the households surveyed intend to participate in the program. Of those households, 42.9 percent are of the view that the program will help ease their daily expenditures somewhat, particularly foods and beverages, while 36.8 percent want other measures that are more effective such as those that help reduce their water utility and electricity bills.
  • KResearch views that the KR-ECI will be pressured by a number of factors ahead, including higher production and transportation costs, driven by energy prices such as cooking gas because they are set to increase in steps. Moreover, the fuel tariff (FT) will be raised for September-October, and there be a hike in the daily minimum wage for the first time in two years on October 1, 2022. Therefore, close attention must be paid to a cost transfer from operators to consumers. Caution must also be exercised towards flooding in many areas experiencing heavy precipitation. In spite of this, a rebound seen in economic activity and various government assistance measures such as the co-payment program, and those related to energy may help households to stay afloat somewhat during the remainder of the year.

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Thai Economy