Large cut in Thai interest rates

The protestors have ended their blockade of Bangkok's airports

Thailand's central bank has cut interest rates by the largest amount in eight years, as it aims to lift an economy hit by recent political unrest.

The Bank of Thailand has reduced its key lending rate by one percentage point to 2.75%.

Its move comes after anti-government protestors ended a week long blockade of Bangkok's two airports, grounding both passenger and cargo flights.

The bank admitted the political problems were harming the economy.

'Repercussions'

"Domestic political problems are likely to have greater repercussions on economic growth than previously assessed, particularly to confidence and tourism," said assistant governor Duangmanee Vongpradhip.

The bank added that the Thai economy was already being hurt by the global economic slowdown.

The Thai government warned earlier this week that the political turmoil had shattered business confidence, and that the economy may go into recession next year, causing an increase in unemployment.

Thai analysts also say that despite the end of the blockade at the airports, there is no guarantee that political turmoil will not return.