Thailand's industrial sentiment index dropped to its lowest level in 27 months in September due to weak domestic demand, floods and a strong baht , the Federation of Thai Industries said on Wednesday.
The FTI said its industrial sentiment index fell to 87.1 in September from 87.7 in August.
Purchasing power has been weakened by high household debt levels, reflected in a slump in auto sales as banks have tightened up on lending, the FTI said in a statement.
The baht's rise against the US dollar, which saw it reach its strongest levels in more than 2-1/2 years last month, has pressured exporters, while cheap imported Chinese goods have also impacted Thailand's manufacturing sector, the FTI said.
The baht has appreciated by 2.5% against the dollar so far this year, to be Asia's second-strongest currency after the ringgit.
The federation urged the Bank of Thailand to keep the baht at appropriate levels and interest rates aligned with the economy.
Floods in parts of Thailand have damaged the agricultural and industrial sectors, as well as tourism destinations, the FTI said, adding the government should introduce more stimulus measures.
