Market Summary

Yield Movements

Thailand's local currency (LCY) government bond yield curve steepened between 3 November and 6 February. Shorter-term bond yields declined as the Bank of Thailand resumed its monetary policy easing cycle, reducing its policy rate by 25 basis points each at its December and February meetings. Longer-term bond yields rose on expectations of increased government borrowing to fund the new administration's stimulus plans.

Local Currency Bond Market Size and Issuance

Thailand's LCY bond market reached a size of THB17.8 trillion at the end of the fourth quarter of 2025, up 1.1% quarter-on-quarter (q-o-q) versus 2.5% q-o-q in the prior quarter. Overall market expansion slowed on a weaker increase in government bonds and a contraction in corporate bonds. Issuance of new LCY bonds edged down 0.9% q-o-q to THB2.2 trillion on reduced government borrowing and tepid corporate bond sales. Government bond issuance fell 5.3% q-o-q to THB486.4 billion, while corporate bond sales inched up 0.2% q-o-q to THB371.0 billion.

Sustainable Bond Market

The expansion of Thailand's sustainable bond market accelerated in 2025, propelled by robust issuance of sustainability-linked bonds (SLBs). The stock of sustainable bonds expanded of 34.1% year-on-year to USD34.0 billion in 2025, up from the 24.6% year-on-year in 2024. While sustainability bonds remained the predominant instrument type, comprising 47.5% of total sustainable bonds, the share of SLBs has increased markedly from 15.8% in 2024 to 36.2% in 2025. Issuance of SLBs in 2025 amounted to USD8.3 billion, representing 82.3% of total sustainable bond issuance. The public sector was the most active issuer of SLBs in 2025, accounting for almost 90% of total SLB offerings.