The Bank of Thailand insists that despite shocks and changes experienced in the macroeconomic environment, the country's fundamentals remain strong, as reflected in the country's current account surplus, stable foreign exchange rate and low unemployment.
Central bank governor Prasarn Trairatvorakul yesterday said speeding up infrastructure investment would induce a multiplier effect and create projects to benefit future generations.
Public measures aimed at alleviating the plight of farmers and small and medium-sized enterprises are also feasible, Mr Prasarn said, adding that Thailand's lower economic growth prospects stemmed largely from a slowdown in exports.
"I don't think the issue [the lower growth figure] is concentrated only in Thailand, as other countries, particularly in Asia, have revised down their growth projections," he said.
"One of the important reasons [for the revised growth forecasts of Asian economies] is the slowdown in exports for each country."
The central bank will release its own export contraction forecast soon, Mr Prasarn said.
Lower-than-expected economic growth hurts businesses engaged in trade, so the central bank's monetary easing is intended to provide support amid the cyclical downturn.
Thailand's sluggish economic recovery and the chronic depression in the global economy have prompted the Bank of Thailand to slash its GDP growth forecast for the full year to slightly below 3%, while its 1.5% prediction for export contraction will also be lowered.
The new forecast will be announced on Sept 25, when the Monetary Policy Report is due to be published.
Lower inflation is a result of plummeting oil prices since the end of last year, Mr Prasarn said.
Core inflation, which excludes energy and fresh food prices, remains in positive territory, and inflation could rise in 2016 due to this year's low base.
The National Economic and Social Development Board (NESDB) yesterday said the Thai economy slowed to 2.8% growth in the second quarter, down from 3% in the first quarter.
After seasonal adjustment, the Thai economy in the second quarter expanded by 0.4% from 0.3% growth in the first quarter, the government's economic planning unit said.
In the first half of this year, the Thai economy grew by 2.9% year-on-year, improving from 0.2% growth in the first half of 2014 and 1.6% growth in the second half of 2014.
Key contributors were public investment and tourism, while exports were hit by the global economic slowdown.
Hotels, restaurants and construction saw robust growth. The agricultural sector suffered the effects of drought, while a contracting industrial sector mirrored the decline in export-oriented industries.
Given the weaker economic performance in the second quarter, the NESDB yesterday slashed its 2015 GDP growth forecast to a range of 2.7% to 3.2%, down from 3-4% in May.
It also shaved its full-year export forecast to a 3.5% contraction against an earlier projection of 0.2% growth.
NESDB secretary-general Arkhom Termpittayapaisith said shipments to nearly all major markets except the US shrank in the second quarter.
He urged the government to expedite public spending and investment in the remaining months of this year.
Deputy Prime Minister MR Pridiyathorn Devakula, the government's point man on economic issues, said despite lower growth in the second quarter, he was quite satisfied with 2.8% at a time when the global economy was in a downward trend.
The government must continue to disburse funds and support tourism in order to stimulate the economy in the remaining months of the year, he said.
Sarun Sunansathaporn, an economist in Bank of Ayudhya's research department, said exports of services should remain strong with the skyrocketing number of inbound visitors, while GDP-based exports of goods would probably turn positive in the fourth quarter amid the baht's depreciation.
The central bank's Monetary Policy Committee is likely to keep its 1.5% policy interest rate unchanged throughout the year, he said, citing quarter-on-quarter growth momentum, bottoming inflation and strengthening fiscal stimulus.
Santitarn Sathirathai, Credit Suisse's Singapore-based head of economic research for Southeast Asia and India, said the increasing reliance on tourism could make Thailand vulnerable to China's economic slowdown and the yuan's volatility.
Tourism spending is expected to account for more than two-thirds of Thailand's real economic growth this year, he said.
Credit Suisse expects full-year GDP growth of 2.5% for the country.