KTB recommends accumulating long-term US and Thai bonds, expects two Fed rate cuts in 2027

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Summary · why it matters

Poon Panichpibool, money and capital market strategist at Krungthai GLOBAL MARKETS, Krungthai Bank, said the US 10-year bond yield is moving around 4.68 percent, supported by risk-on sentiment and expectations of Fed rate hikes, but capped by hopes for US-Iran ceasefire talks that are pressuring energy prices. He maintained a recommendation to gradually buy long-term US and Thai bonds when the US 10-year yield rises above 4.50 percent, as the Fed is expected to hold rates in 2026 before cutting twice in 2027, in the second and fourth quarters, contrary to the latest Dot Plot and market expectations. The Bank of Thailand is likely to hold rates throughout this year and next. Meanwhile, the Thai 10-year bond yield has fallen to 1.90 to 2.00 percent, which is a fair value zone, reducing its attractiveness. He recommends buying only when yields rise, and views 20-year Thai bonds as more interesting but requiring acceptance of high volatility. On currencies, the dollar strengthened amid risk-on sentiment and better-than-expected US economic data, pushing the DXY index toward the 100 level. Gold prices remain above 4,100 dollars per ounce, pressured by a stronger dollar but supported by ceasefire hopes and buy-on-dip demand.

Impact on assets 5

Financials▲ · 1 stocks
Others▼ · 2 stocks
％United States Government Bond 10Y
US-10Y
▼ NegativeMonetaryrelevance

Expectations of Fed rate cuts in 2027 and current yield around 4.68% suggest yields may decline, but near-term risk-on sentiment supports yields.

Others▲ · 2 stocks
⛏Gold Futures
GOLD
± MixedMonetaryrelevance

Gold pressured by stronger dollar but supported by ceasefire hopes and buy-on-dip demand; mixed signals.

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