Domestic credit growth slowed to 6.8 percent in February while deposits grew by 6 percent. Contraction in economic activities further eased the pressure on prices, with headline inflation declined to a minus 0.2 percent in March. Given the sharp dislocation in economic activities in the last few months, market consensus now seems to agree on a small negative growth for Thailand this year, but with an improvement in growth next year. This means the market expects the Thai economy this year to go through a period of sharp adjustment on account of the global slowdown before growth is resumed next year. This view is consistent with the current mainstream view that, with the strengthening of the policy efforts at the global level, the world economy should look better next year compared to this year. As for the Bank of Thailand, our Monetary Policy Committee in its meeting next week, will also be going over this same question in assessing the near-term outlook for our deliberation of monetary policy. Whatever growth numbers we come up with, they will be conditional upon the prospects of the global economy going forward, especially after the G-20 announcement of the new global policy. Turning now to a more positive note, regardless of the adjustment we have to go through this year, or even next year, the Thai economy at this time is fundamentally stronger, and is in a better position to weather the crisis, compared with the situations we were in ten years ago during the Asian financial crisis.
Bandid Nijathaworn: Thailand’s banking and economic outlook Keynote address by Dr Bandid Nijathaworn, Deputy Governor of the Bank of Thailand, at the Australian-Thai Chamber Luncheon, Bangkok, 3 April 2009. *  *  *  Let me first thank AustCham Thailand, especially President Andrew Durieux, for the invitation to speak at today’s luncheon. It has been almost four years since I last spoke at an AustCham event, so, it is a pleasure to be back. Today I will speak on Thailand’s banking and economic outlook, a subject which I am sure will be of interest to all of you. In keeping with what a good luncheon speaker should do, I will keep my remarks short and to the point, so that we will have plenty of time for desserts and for questions and answers. This week is undoubtedly an important week for the global economy, as leaders and finance ministers of the world’s twenty most important economies gather in London to map out a strategy that aims to comprehensively address the current global financial crisis. Up to now, policies to tackle the crisis have been left largely to the individual economies in response to the problems that arise. But as the crisis has mutated into a major global problem, a coordinated policy response at a global level is clearly needed to ensure a synchronized recovery in all the key parts of the global economy. Without coordinated and comprehensive policy response, a synchronized recovery will not take place.