Market Summary

Yield Movements

Between 2 June and 29 August, Thailand's local currency (LCY) government bond yield curve shifted downward in response to monetary policy easing by the Bank of Thailand (BOT). Yields fell an average of 46 basis points across the curve following the central bank's policy rate cut on 13 August. The BOT has lowered its policy rate by a total of 75 basis points this year to support the domestic economy amid trade uncertainty.

Local Currency Bond Market Size and Issuance

Thailand's LCY bonds outstanding amounted to THB17.2 trillion at the end of June, down 1.0% quarter-on-quarter (q-o-q) in the second quarter (Q2) of 2025 due to maturities in both government and corporate bonds. Issuance of LCY bonds rose 2.2% q-o-q to THB2.2 trillion, driven largely by increased issuance of government bonds as authorities increased borrowing to finance stimulus measures. Meanwhile, corporate bond sales recovered slightly, edging up 0.8% q-o-q in Q2 2025 after 3 consecutive quarters of contraction as firms took advantage of a low-interest-rate environment amid continued monetary policy easing by the BOT.

Sustainable Bond Market

Thailand's sustainable bonds outstanding reached USD26.4 billion at the end of June and remained dominated by public sector sustainability bonds. The Thai sustainability bond market continued to post robust growth, expanding 4.8% q-o-q in Q2 2025 after a 4.6% q-o-q increase in the previous quarter. About 64.1% of outstanding sustainable bonds had remaining tenors longer than 10 years, resulting in a size-weighted average tenor of 9.0 years at the end of June. LCY-denominated securities accounted for 98.5% of Thai sustainable bonds, which remained among the highest shares in emerging East Asia.