BANGKOK, Oct. 16 (Xinhua) -- Thailand's industrial confidence dropped for the second straight month in September, due to impacts from flooding amid weak domestic demand and high household debt, data showed on Wednesday.

The Thai Industries Sentiment Index inched down to 87.1 last month from 87.7 in August as all components of the index decreased, according to the Federation of Thai Industries (FTI).

The reading was based on a survey of 1,353 entrepreneurs from 46 industry groups under the FTI.

Consumers were cautious about spending on durable goods, reflected in a slump in local auto sales, which saw a contraction of 24 percent between January and August as banks tightened loan approvals amid household debt issues, the FTI said in a statement.

The rapid appreciation of the baht currency has put pressure on the export sector, particularly in agricultural and food sectors that rely on domestic raw materials, lowering Thai goods' competitiveness in international markets, said FTI Vice Chairman Nava Chantanasurakon.

However, growth in exports and the tourism sector, a key driver of the Southeast Asian country's economy, during the year-end high season is expected to boost sentiment, Nava told a news conference.

The index forecast for the next three months rose to 96.7 in September from 93.9 a month earlier as entrepreneurs were optimistic about the government's cash handout stimulus packages and liquidity enhancement measures to help flood victims.

The group urged the government to implement additional steps, including tax incentives to boost private consumption and initiatives to promote domestic tourism, as floods in several regions of the kingdom have damaged the agricultural and industrial sectors, as well as tourist destinations. Enditem

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