Thailand 5 Year Government Bond

The Thai Bond Market Association, or ThaiBMA, reported that at the end of the third quarter of 2026 the outstanding value of the Thai bond market stood at 18.4 trillion baht, or 97% of gross domestic product, up 2.9% from the end of 2025, driven mainly by an increase in government bonds. Corporate bonds had an outstanding value of 4.5 trillion baht, down 0.7% from the end of 2025, with the property, banking and ICT sectors posting the largest declines. Long-term debenture issuance in the first nine months of 2026 totalled 629.662 billion baht, down 1.6% from the same period a year earlier, with the energy, finance and property sectors recording the three highest issuance volumes. On foreign fund flows, overseas investors sold Thai bonds on a net basis to the tune of 39.309 billion baht in the third quarter of 2026, bringing net outflows over the first nine months to 9.21 billion baht, though foreign investors were still net buyers of long-term government bonds to the tune of about 25 billion baht, leaving their cumulative holdings of Thai bonds at the end of the third quarter of 2026 at roughly 910 billion baht, or 5% of the outstanding value of the Thai bond market. Yields on Thai government bonds with maturities of 2, 5 and 10 years rose from the end of 2025 by 26, 52 and 71 basis points to 1.39%, 1.80% and 2.37% respectively, while five-year debentures rated AAA, AA, A and BBB+ carried yields of 2.06%, 2.45%, 2.71% and 4.19% respectively. As for the outlook for the remainder of 2026, a survey of most market participants expects the Monetary Policy Committee to hold the policy rate at 1.00% for the rest of the year, and expects the yield on five-year Thai government bonds at the end of the fourth quarter of 2026 to move in a range of 1.77% to 1.86%, while the 10-year yield is expected to stay within a range of 2.33% to 2.47%.

Kasikorn Research Center stated that government bond yields surged worldwide after the US government announced a bond buyback plan of only 6 billion dollars, below market expectations of nearly 10 billion dollars. Dr. Kanchana Chokpaisarnsilp, research executive at Kasikorn Research Center Co., Ltd., said the impact on Thai bond yields may not yet be very clear, since Thailand's policy interest rate will remain steady at 1% for the foreseeable future. Thai 10-year bond yields rose to 2.29%, up 60 basis points; 7-year yields stood at 1.99%, up 57 basis points; 5-year yields stood at 1.69%, up 39 basis points; 3-year yields stood at 1.34%, up 16 basis points; and 2-year yields stood at 1.26%, up 12 basis points. The policy interest rate will limit short-term bond yields from rising much, but long-term bond yields such as the 10-year may surge in line with global market movements, which will in turn become a cost for businesses issuing bonds. Every borrower will face the same reference point in US bond yields, but how much more expensive borrowing becomes depends on the credit spread, with those rated poorly facing higher interest rates, posing a challenge for bond issuance in the remainder of the year.

Today, the Thai Bond Market Association reported that investors in the categories of asset management companies, insurance companies, and foreign investors made net purchases totaling 15,470 million baht. Asset management companies net bought 13,485 million baht, insurers net bought 1,945 million baht, and foreign investors net bought 40 million baht. Meanwhile, the total trading value for the day stood at 88,320 million baht. The yield on 5-year bonds closed at 1.7%, up 0.04%, and the yield curve shifted up by 2-5 basis points in line with US Treasuries, following higher global oil prices. In the auction results for government bonds, the LB365A series with a 10-year maturity and an issue size of 32,000 million baht achieved a yield of 2.1979%, which was 3 basis points higher than the market, with a bid-to-cover ratio of 1.13 times. For the LBA506A series with a 25-year maturity and an issue size of 8,000 million baht, the yield was 3.1726%, 4 basis points higher, with a bid-to-cover ratio of 2.26 times. Foreign investors saw a net inflow of 40 million baht, with no maturing instruments. On the external factors front, the US manufacturing PMI for August remained steady at 53.9, while the Joint Standing Committee on Commerce, Industry, and Banking revised up its forecast for Thai economic growth in 2026 to 2.1-2.5% and exports to 12-16%.

Today, the Thai Bond Market Association reported that investors in the categories of asset management companies, insurance companies, and foreign investors had a combined net purchase of 8,830 million baht, broken down into asset management companies with a net purchase of 2,463 million baht, insurance companies with a net purchase of 919 million baht, and foreign investors with a net purchase of 5,452 million baht. Meanwhile, the total trading value for the day stood at 76,854 million baht, and the yield on 5-year bonds closed at 1.61%, down 0.01% from the previous day. The auction results for the government bond series LB556A, with a maturity of 30 years and a total amount of 8,000 million baht, yielded a return of 3.1655%, which is 6 basis points higher than the market yield, and the bid-to-cover ratio was 2.37 times the offered amount. Today's foreign investment flows showed a net inflow of 4,948 million baht, resulting from a net buy of 5,452 million baht and maturing bonds of 504 million baht. On the policy side, the Monetary Policy Committee unanimously decided to keep the policy interest rate at 1.00% per annum to support the recovery of the Thai economy.

The Thai Bond Market Association reported that fund management companies made net purchases of 13.991 billion baht, insurance companies net bought 2.419 billion baht, and foreign investors net bought 3.966 billion baht today, bringing combined net buying from these three groups to over 20 billion baht. Total trading value for the day stood at 106.529 billion baht. The five-year bond yield closed at 1.57%, down 0.02% from the previous day. Meanwhile, the auction of five-year government bonds worth 32 billion baht drew a yield of 1.5122%, and the 50-year bonds worth 7 billion baht drew a yield of 3.2893%.