With U.S. bond yields testing levels last seen in 2002, Thailand-based InnovestX Securities is recommending high-quality short- to medium-term bonds, steady domestic businesses and selected AI supply-chain companies, the Bangkok Post reported.
Reuters and The Associated Press reported that the 10-year U.S. Treasury yield briefly reached 5.34% on Oct. 1, its highest since 2002. The Treasury’s daily par-yield series showed 5.24% for the same maturity that day. That series is based on indicative bid quotations collected around 3:30 p.m. each trading day, while the higher figure was an intraday peak.
The Energy Information Administration recorded Brent crude’s spot price at $114.82 a barrel on Oct. 1. U.S. consumer prices rose 3.7% in the 12 months through September, compared with 3.4% through August, according to the Bureau of Labor Statistics. Gasoline prices rose 9.1% in September and accounted for more than half of that month’s increase in the all-items index.
The Federal Reserve raised its target range for the federal funds rate by 25 basis points on Sept. 16, to 3.75%-4.00%, and said inflation remained elevated. InnovestX linked some pressure on yields to government bond supply and funding demand from AI projects, the Bangkok Post reported.
In the newspaper’s account of the firm’s recommendations, InnovestX pointed to home-improvement retailers, hospitals and telecommunications companies as examples of businesses with stable Thai revenue. It also favored AI supply-chain companies with reported earnings. The firm cautioned against high-yield Thai corporate bonds, long-dated debt from heavily indebted countries, AI investments financed with borrowing and consumer lenders.
The Bangkok Post also reported that InnovestX forecast the 10-year Treasury yield at 5.1% at the end of 2026 and 4.6% at the end of 2027. The firm said higher fuel and living costs were pressuring Thai households and could make it harder for borrowers to repay consumer loans, according to the newspaper.
“The most expensive risk is having your money in the wrong place,” said Dr Pisak Manasan, head of Economic Research at InnovestX Securities, in comments reported by the Bangkok Post.
The Federal Open Market Committee is scheduled to meet Tuesday and Wednesday, Oct. 27-28.
