KSS predicts SET may rally on rate cut

The Thai stock market is poised for an August rally on expectations the Bank of Thailand's Monetary Policy Committee (MPC) will trim the policy rate at tomorrow's meeting, says Krungsri Securities (KSS).

- NUNTAWUN POLKUAMDEE

According to KSS estimates, every rate cut of 25 basis points (bps) could lift the Stock Exchange of Thailand (SET) index by 50-55 points.

This outlook follows recent Commerce Ministry data on inflation showing the headline consumer price index (CPI) in July contracted 0.7% year-on-year, sharply below market expectations and deeper than June's decline of 0.25%.

Core CPI, which excludes volatile energy and fresh food prices, rose just 0.84% from a year earlier, decelerating from a 1.06% annualised surge in June and falling below the central bank’s target range of 1-3%.