Mr Uttama, right, greets Ms Georgieva. The IMF lowered the forecast for Thailand's economic growth to 2.9% for this year.

Thailand's strong macroeconomic fundamentals give policymakers space to use both fiscal and monetary policy to drag the economy out of the doldrums, according to the IMF chief.

The country needs to take care of the economy by using all tools in a timely manner, IMF managing director Kristalina Georgieva told Finance Minister Uttama Savanayana.

The Washington-based multilateral lender has taken note of Thailand's reforms in preparation for a new economy, as well as its sufficiency economy principles, he said after a meeting with Ms Georgieva.

The IMF's executive directors recently said in a report about an Article IV consultation in Thailand that they have encouraged an expansionary policy mix to support domestic demand, plus structural reforms to promote inclusive and sustainable growth.

The IMF lowered the forecast for Thailand's economic growth to 2.9% for this year from 3.5% predicted previously and 3% for 2020 from 3.5% because of weaker external demand.

Mr Uttama said the IMF believes the global economy is experiencing a synchronised slowdown, stemming from uncertainties, including trade rifts and Brexit, that have together dealt a blow to the economy.

The Finance Ministry is preparing a new economic stimulus package, he said.

"Whether the additional economic stimulus measures are needed requires further monitoring," said Mr Uttama.

The stimuli are short-term measures to help Thailand overcome the slowdown, while reforms and technology adoption to drive productivity are crucial tools to see the country achieve its economic growth potential, he said.

The economy is expected to improve this quarter, thanks to benign external factors, but full-year growth will not reach its growth potential of 4%, said Mr Uttama.

Kobsak Pootrakool, deputy secretary-general to the prime minister for political affairs, said the additional stimulus package could be launched later this year to invigorate the economy after the third-quarter reading was weaker than expected.

The cabinet last month approved the second phase of the cash handouts and cash rebates, which run until the end of the year. Under the second phase, participants still enjoy the same 1,000-baht cash handout as well as a cash rebate of up to 20%.

About 10 million people who registered under the first phase, which kicked off on Sept 23 and offered a 15% rebate, are also entitled to the 20% rebate.

The spending scheme is part of the government's 316-billion-baht stimulus package aimed at boosting the country's economic growth to 3% this year after the economy lost momentum, mainly weighed down by sagging exports.

The Finance Ministry agreed with the Bank of Thailand's proposal to narrow the inflation targeting range for 2020 to be in line with changing circumstances, Mr Uttama said without specifying the target.

The central bank set an inflation target range of 2.5%, plus or minus 1.5 percentage points, for a range of 1-4% this year.