
Prime Minister Samak Sundaravej told reporters the ceremony, organised to boost national unity, would be held tomorrow as scheduled.
The decision came after of thousands of protesters led by the People's Alliance for Democracy occupied Government House on Tuesday and demanded the government stand down.
The protest suffered a blow on Wednesday when a court approved arrest warrants for nine PAD leaders, then the Civil Court issued an order for the protesters to get out of Government House.
PAD leaders warned the protesters that police would soon move to disperse them.
But Samak made a surprise statement last night to senior police, asking them not to use force against the protesters.
"I told police that they should not use force in dealing with the protest at Government House," he told reporters.
He thanked the Civil Court for its injunction ordering the protesters to vacate the compound, saying it had given the government "a sword", but said the authorities would enforce the order with care.
He said that he had already given the green light for police to evict the crowds, but then changed his mind because he did not want violence to erupt.
Samak said he wanted the PAD leaders to surrender instead of being arrested, adding that there is still time to settle the confrontation in a peaceful manner.
He also praised Democrat Party leader Abhisit Vejjajiva for adopting an appropriate stance to help resolve the situation.