The consumer confidence index (CCI) dropped for the first time in five months last month amid worries about a slow economic recovery and the trade war, according to a survey conducted by the University of the Thai Chamber of Commerce (UTCC).
Thanavath Phonvichai, president of the UTCC, said the CCI for February was 57.8, down from 59 in January.
This was the first time in five months the index decreased across all categories, he said.
The decline was attributed to consumer concerns over the trade war ratcheted up by US President Donald Trump, leading to stock market corrections in Thailand and worldwide.
Consumers are also worried about the future, even though the Thai government has implemented economic stimulus measures, as they feel the economy is recovering slowly, said Mr Thanavath.
Moreover, political instability and weakened purchasing power led to a decline in demand for cars and homes, also contributing to a drop in the CCI, he said.
"We have to wait until March to see if the index continues to fall, since it has only decreased for one month," said Mr Thanavath.
The CCI remains below 100, which indicates people still feel the economy is gradually recovering, but they are grappling with high living costs and an escalating trade war, he said.
This situation could further undermine consumer confidence in the short term, said Mr Thanavath.
Meanwhile, the Thai Chamber of Commerce Confidence Index, which reflects the sentiment of the business sector, rose from 49.0 in January to 49.4 in February.
This represents a second month of improvement, indicating a positive response to the government economic stimulus measures announced in February.
These initiatives have encouraged consumer spending, resulting in increased revenue for businesses and and an uptick in money circulating in the economy.
The survey was conducted from Feb 24-28, generating 369 responses.
Mr Thanavath said it is crucial to monitor the situation carefully in March as the economic stimulus measures are expected to be phased out, and it will be important to observe their effect on business confidence.
In addition, US tariff policies and counter measures issued by other countries could also play a significant role in shaping the economic landscape.
