RTTNews - Friday, the International Monetary Fund forecast the Thai economy to contract 3% this year after recording a growth of 2.6% in 2008. The decline would be the first since the Asian crisis.

The output contraction in 2009 could be limited to about 3% provided that political stability is maintained and the authorities' fiscal stimulus speedily and efficiently implemented, IMF's executive board said after the Article IV consultation with Thailand.

The IMF said, to bring the economy back on a sustained high growth path, the Thai authorities need decisive policy implementation to support domestic demand. In addition, a swift restoration of investor and consumer confidence through a normalization of the political situation is also needed.

IMF directors welcomed recent aggressive cuts in the policy interest rate and said there remains room for a further monetary easing.

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