KUALA LUMPUR - Global funds sold a record US$1 billion of Thai bonds last week as the passing of King Bhumibol Adulyadej was seen as the loss of a stabilising influence in the nation’s political landscape.
Overseas investors cut debt holdings for five straight days through Friday, trimming purchases for the year to $10.7 billion, data compiled by Bloomberg show. The baht slumped to the lowest since January last week.
“The selling is overdone because I just think that it’s not going to be a consequential economic development for Thailand,” said Tim Condon, head of Asian research at ING Groep NV in Singapore. “It’s obviously a special time for Thai people and this is a very delicate transition, but I expect it to be a smooth one for financial markets.”
National development efforts will continue while Thais mourn the passing of their king, and the cabinet will meet as scheduled on Tuesday, government spokesman Sansern Kaewkamnerd told reporters in Bangkok on Sunday.
The baht fell 0.1% to 35.361 per dollar as of 11:12am in Bangkok after sliding to 35.902 on Oct 12, the weakest level since Jan 26. The currency dropped 1.3% last week, the most since the period ended Sept 25, 2015.
The yield on Thailand’s 10-year bonds ended last week little changed at 2.21% after climbing to 2.32% on Wednesday, the highest level in eight months, according to data compiled by Bloomberg. The benchmark SET Index of shares retreated 0.2% Monday after dropping 1.8% last week.
