BANGKOK, Dec. 26 (Xinhua) -- The Bank of Thailand (BOT) on Friday lowered the country's economic growth projection for 2014 from 1.5 percent to 0.8 percent.

The Thai central bank in its latest monetary policy report also revised down the forecast for 2015 from 4.8 percent to 4.0 percent.

The quarterly report is aimed at enhancing public understanding of the policy stance of the bank's Monetary Policy Committee and its assessment of Thailand's economic outlook.

Thailand's economy is expected to recover steadily but at a slower pace than previous forecast due to a weaker outlook of both domestic demand and exports, according to the report.

On the domestic side, consumption is expected to gradually recover on the back of improving non-farm income and employment, as well as lower oil prices, the bank said.

However, it added, durable consumption, especially automobile purchases, is still impeded by high household debt and depressed farm income.

In addition, the government spending, particularly on investment projects, is likely to be lower than previously anticipated, due to project reviews and examinations for transparency issues, implementation capacity that does not expand fast enough to meet increased budgets, and labor scarcity in the construction sector.

On the external side, the bank predicted, merchandise exports are likely to grow at a lower rate due to weaker trading partners' demand.

Notwithstanding steady growth in the United States, lower-than- expected growth of the eurozone economies, Japan and China has slowed exports of Asia and Thailand, the report said, adding domestic production limitations and depressed commodity prices would continue to affect Thai exports in the period ahead.

The bank also stressed that for export of services, the rebound of Chinese tourists, whose confidence in Thailand's political situation resumed quickly, had contributed to a steady recovery.

Tourism will also receive additional benefit from lower fuel prices in the period ahead, it said.

Nevertheless, the recovery will be restrained by European and Russian tourists due to their weak economies, and the fact that some tourists remain concerned about the Thai political situation, according to the report.