Business sentiment edges down, but confidence in continued economic expansion remains: BOT

Economy September 03, 2018 20:56

By The Nation

The Business Sentiment Index (BSI) in August slightly decreased to 51.4 points from the previous month’s 52.0, due mainly to declines in employment and investment sub-indices, the Bank of Thailand said in a press release on Monday.

However, most of the sub-indices were still higher than the 50-point threshold.

The three-month-expectation BSI still floated above the 50-threshold and has now improved for two consecutive months, indicating businesses’ confidence in continued economic expansion, the BOT said.

For the employment sub-index, respondents in the manufacturing sector were less optimistic on employment this month, especially those in the steel and textile sectors. 

Meanwhile, for the investment sub-index, fewer respondents in the non-manufacturing sector planned to increase their investment in September, especially those in the construction and the real-estate sectors. 

This was due partly to construction activities slowing down during the rainy season.

In regard to the next three months, the expected BSI rose for the second consecutive month, to 55.4, indicating that most respondents still assessed an improvement in the business outlook, the BOT said. 

Total order books, production and performance sub-indices were the key drivers, especially for respondents in the electronics and electrical-appliance sectors, who expected higher production levels and performance in accordance with higher foreign-order books. 

In addition, respondents in the hotel and restaurant sector were more confident in their business outlook, driven by a higher expected number of both Thai and foreign tourists during the high season. 

Their optimism also reflected expectation that the effect of the Phuket boat accident would only be temporary, the central bank added.