FX.co ★ Thailand 10Y Yield Nears 4-Month Low

Thailand’s government bond yield slipped to around 1.94% in early July, approaching a four-month low, after the Bank of Thailand reaffirmed its accommodative monetary stance. Minutes from the June policy meeting showed that officials intend to keep interest rates steady until the economy returns to its potential growth rate of at least 2.7%. The central bank noted that current settings continue to support the recovery, with inflation remaining within its 1%–3% target band and no immediate need for policy tightening. Even so, policymakers reiterated that rate hikes could become necessary if inflation expectations become unanchored, financial stability risks intensify, or the economy reaches its potential growth path. The BOT projects economic growth of 2.3% this year, easing to 1.8% in 2027, and cautioned that inflation risks remain elevated due to the potential impact of El Niño and ongoing geopolitical tensions in the Middle East.