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In its monthly release of economic figures, the Bank of Thailand said the business sentiment index for November and the forecast business sentiment index for the following three months had fallen to the lowest levels ever recorded: 34.4 points in November and 37.1 for December, January and February.

The prolonged political stalemate has hit the service sector hard and aggravated conditions for the manufacturing sector, which was already adversely affected by the sliding global economy.

Economic growth for the entire year is now likely to be less than the most recent forecast of 4.3 per cent.

Nevertheless, Bank of Thailand senior director Amara Sriphayak is optimistic that domestic spending will help to maintain economic momentum when the new government successfully announces its policies.

However, the economy will not rise substantially because it will be hit hard by the global downturn.

"If sentiment can hurt private consumption in November, it can also bring confidence back on track next year. But the economy will certainly not be effulgent as we cannot escape the global economic problems," she said.

Amara said the economy could contract this quarter, compared with the previous third quarter. However, it remains unclear whether yearonyear economic growth in November will be negative. Primary studies show that the yearonyear economy could be flat in the fourth quarter, if the quarteronquarter economy posts a contraction of 2.5 per cent.

In November, private consumption, investment and exports all contributed to a significantly gloomy economic picture.

The private consumption index fell by 1.6 per cent from that of the same month last year. It was the first contraction since June last year.

Both seasonally adjusted car and fuel indexes were lower by 13.7 and 4.1 per cent, respectively.

The private investment index expanded slightly in November by 1.2 per cent from the same month in 2007, but it was still slower than 2.2percent growth in October.

The manufacturing production index contracted by 6.6 per cent, marking the lowest pace since May 1998. Capacity utilisation was only 61.2 per cent, the lowest pace since April 2002.

Production in all sectors, except petrochemicals and vehicles, recorded negative growth in November.

The manufacturing production index of exportoriented sectors - particularly hard disk drives - dropped for the first time in November, with a contraction of 8.4 per cent.

Amara urged the government to speed up budget disbursements for investment projects and even speed up some recently introduced economicstimulus measures to incessantly drive the economy.

"There has been a changing point, and conditions are expected to be better than those in November. The sentiment has improved, so the government should be allowed to get on with its work," she said.