BANGKOK, Oct 11 (Reuters) Thai consumer confidence in the economy fell to its lowest in more than five years in September due to a strong baht, high oil prices and widespread flooding in rural Thailand, a university survey showed on Thursday.
The index fell to 69.2, its 11th straight monthly decline, from 69.5 in August but was expected to improve after general elections scheduled for Dec. 23, the University of Chamber of Commerce said in a statement.
''Consumption is not likely to increase much at the moment as all consumer confidence indices were still below 100,'' it said. A reading below 100 indicates weaker consumer confidence than before the 1997/98 Asian financial crisis.
''But the future index improved for the second month as people expected the situation to be better after the elections,'' it said, referring to the rise of an index which projects confidence over six months to 74.9 in September from 74.4 in August.
''The falling consumer confidence suggested that sentiment remained quite fragile and should continue until after the election. Rising oil prices and the U.S. economy are also factors of concerns,'' Standard Chartered economist Usara Wilaipich said.
Economists expect the Thai economy to expand 4.2 percent this year, the least since 2001 and down from 5.0 percent last year, under a military-appointed government despite five interest rate cuts by the Bank of Thailand this year to stimulate growth.
But economic growth was expected to accelerate to 4.8 percent in 2008 if the December election encouraged people to spend more, a Reuters poll showed.
The baht has risen onshore about 5.6 percent against the dollar so far this year, threatening the competitiveness of the export-driven economy. It rose 14 percent against the dollar last year, the most of any Asian currency.
The central bank said in a statement its current Business Sentiment Index (BSI) rose to 43.4 in August from 40.7 in July due to an increase in production and orders and a decline of production costs.
The September-November BSI index also rose to 50.2 from 48.9 for the August-October period, the bank said.
''The 3-month expected BSI surpassed the 50 benchmark for the first time in six months,'' it said, with a figure below 50 showing sentiment has improved.
REUTERS MP DS1607