Foreigners get keen on Thai markets

Investors speculate on possible rate cuts

- NUNTAWUN POLKUAMDEE

Foreign investors have returned to Thailand's bond and equity markets, with net inflows into the bond market surpassing 40 billion baht in May and nearly 100 billion baht year-to-date, according to the Thai Bond Market Association (ThaiBMA).

The Thai stock market is also recording renewed interest, with net foreign buying reported last week, pushing the Stock Exchange of Thailand (SET) index to surpass 1,200 points and lifting trading volumes significantly.

Ariya Tiranaprakij, executive vice-president of ThaiBMA, said the inflows into bonds reflect short-term investments aimed at arbitrage between the baht and the dollar.

Investors are also speculating on potential interest rate cuts by the Bank of Thailand, following persistently low inflation, which remains below the central bank's target. Despite ongoing volatility driven by the unresolved US-China trade war, there is still room for further capital inflows into the Thai market in the near term, she said.