Bangkok: The Thai Chamber of Commerce's confidence index for December 2025 remained steady at 44.2, mirroring the previous month's figure, as reported by the University of the Thai Chamber of Commerce (UTCC).
According to Thai News Agency, this consistency highlights ongoing business concerns about the sluggish economic recovery, the high cost of living, and prevailing economic and political uncertainties.
The Center for Economic and Business Forecasting identified the slow economic recovery and the high cost of living, coupled with sluggish consumer spending, as the primary negative drivers affecting the confidence index. These factors have significantly weakened domestic purchasing power, particularly towards the end of the month. Additionally, the flooding situation in the lower southern region has adversely impacted agriculture, transportation costs, and confidence in the service and tourism sectors' recovery.
Despite a ceasefire on the Thai-Cambodian border, businesses remain cautious of a prolonged situation that could negatively impact border trade and operations. On the positive side, the reduction in the policy interest rate and the "Half-Half Plus" stimulus measure offer some relief.
The slight appreciation of the Thai baht towards the end of December, from over 33 baht per US dollar to around 31 baht, has raised concerns about export competitiveness among businesses. Global geopolitical tensions, including conflicts in the Middle East, Russia-Ukraine, and other regions, are also perceived as risk factors requiring close monitoring in early 2026.
In the agricultural sector, key commodity prices, such as rice, corn, and cassava, remain low, hindering a recovery in farmers' income. Meanwhile, high production costs and political uncertainty following the parliament's dissolution in December have led foreign investors to delay investment decisions, pending clarity on the new government's economic policies post-election.
Despite these challenges, some positive factors support confidence, such as a 0.25% reduction in the policy interest rate to 1.25%, which is expected to lower business financing costs. Government economic stimulus measures, including the "Half-Price Plus" project and tourism promotion allowing tax deductions, alongside the election campaign atmosphere, may stimulate economic activity in certain areas.
In the trade sector, year-end exports expanded by approximately 7.05%, reaching a value of around US$27 billion. However, imports remained higher at US$30.172 billion, resulting in a trade deficit of approximately US$2.7 billion. Domestic retail fuel prices, particularly diesel, showed a downward trend, while the Stock Exchange of Thailand (SET) Index saw a slight increase, aligning with the year-end investment cycle.
A provincial-level business perspective survey revealed that 48.2% of respondents viewed the economic situation as deteriorating, with only about 22-23% seeing improvements. Investment in nearly 66% of the provinces shows signs of slowing, and around 39% of the agricultural sector views the situation as worsening due to low crop prices. The industrial and trade sectors remain stable, while border trade and employment continue to face challenges.
The current business confidence index saw a slight decrease of about 0.1 points from the previous month, while the six-month forecast index rose by approximately 0.2 points, indicating cautiously positive expectations. Businesses continue to await clarity on government formation, economic policies, and future economic stimulus measures, which will be crucial factors influencing confidence in early 2026.