Thailand Business Sentiment Index Down in April Following Strong Volatility in Commodity and Energy Prices

The Bank of Thailand (BOT) reported that the business sentiment index fell to 48.2 in April from March as.

All components remained above 50, with the exception of cost sentiment, which remained low. Especially in the manufacturing and real estate sectors, where high volatility in commodity and energy prices due to the ongoing conflict between Russia and Ukraine is driving up prices for some products.

Moreover, the government’s measures to support purchasing power are gradually coming to an end. As a result, confidence in orders, production and operating results has declined. In the manufacturing sector, most companies’ confidence in earnings and production has declined due to an increasing shortage of inputs. This is compounded by temporary factors such as the lower number of working days compared with the previous month due to the long vacation during the Songkran festival.

While service and trade companies benefited to some extent from temporary factors during the Songkran festival this year, the atmosphere started to become busier. As a result, confidence in orders and earnings of this group improved. This contributed to a slight decline in the non-manufacturing sector index.

Most entrepreneurs believe that business will continue to expand from now on. With the exception of the construction and real estate sector, where the index is below 50 because confidence in almost all components, especially costs, has fallen.

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