Standard Chartered Bank: Stay neutral on THB bonds

Quotes from Standard Chartered

• The bull flattening of the THB yield curve since October 2014 reflects disinflationary pressure from the drop in global crude oil prices.
• Indeed, ahead of the BoT's January monetary policy announcement, the market was pricing in a possible rate cut due to strong disinflationary pressures.
• However, the BoT kept policy rates on hold, and the market has since unwound its rate-cut expectations.
  
  
• We have a Neutral outlook on THB bonds, as unattractive valuations are likely to counter-balance the impact of the accommodative monetary polciy adopted by major developed-market central banks.