2 %, 6. 9 % to 2. 1 %, and 6. 3 % to 4. 3 %, respectively, thailand fared much better with respect to the magnitude of the slowdown. the fact that we managed to hold on a satisfactory growth performance given the surrounding circumstances is a testament to the resiliency and the underlying strength of the thai economy. two major negative developments were behind the slowdown in the second quarter. on the external front, crude oil prices surpassed the 120usd mark for the first time in history. successive rises in oil prices weighed down heavily on firms ’ production costs and cut in consumers ’ real spending power. had our exports not held up well, thailand ’ s real gdp growth would have been much lower. in addition, the direct and second - round effects from oil price increases also led to the acceleration in inflation this quarter, with the headline inflation rate reaching 8. 9 % for the month of june. the second negative development was on the domestic front and that was the return of street demonstration that has escalated to today ’ s political standoff. this development has had significant effects on consumers ’ and businesses ’ sentiment, not to mention investors ’ confidence that has contributed to continued net selling by foreign investors. fortunately for thailand, agricultural prices also accelerated in the second quarter. the rise in the prices of agricultural exports contributed to the robust export performance and at the same time partially offset the negative impact of increases in the prices of oil and other commodities imports. moreover, increases in farm income due to the price effect coupled with strong production allowed farmers to cope with higher costs of living associated with rising inflation, providing support for private consumption which continued into this current quarter. for the remainder of this year, the recent trend in oil prices appears to be on our side, especially on inflationary pressure. oil prices have fallen much lower than what we had anticipated during our last round of economic forecast in july which had headline inflation projection in the range of 7. 5 - 8. 8 % for the year. the fall in oil prices adds on top of the temporary favorable price impact from the government ’ s six - months - six - measures program which was not included in time for the forecast and will together be a major factor in our october forecast round. the fall in oil prices is also expected to have a significant impact on economic growth which was forecasted to be in the range of 4. 8 % - 5. 8 % for this year. unfortunately, the impact of

to have greater flexibility in the setting of the inflation targets, in terms of the choice between core and headline inflation, as well as the level of the inflation targets itself, so that monetary policy will have greater room to maneuver in responding to shocks. if done carefully, the room for flexibility can be added without undermining the credibility of the inflation - targeting framework. but whatever flexibility we add, it is most important that the long - term objective of monetary policy in sustaining a low and stable inflation environment and in anchoring inflation expectations over the cycle is maintained and not compromised.