http://www.bloomberg.com/news/2014-05-18/thai-bonds-are-best-in-region-as-political-unrest-hurts-economy.html
Thailand’s government bonds are leading gains in Southeast Asia as a worsening political crisis and deteriorating economy prompt local investors to favor the safest assets.
The debt has returned 2.4 percent in local currency terms this quarter, Bloomberg indexes show. The 10-year yield dropped nine basis points to 3.47 percent since the May 7 ouster of Yingluck Shinawatra as prime minister, touching a one year-low of 3.42 percent on May 16. Gross domestic product fell 2.1 percent in the first quarter from the preceding period, when it increased a revised 0.1 percent, official data showed today.
Anti-government protesters derailed plans for a July 20 election and the army has said it may use force to counter any escalation of political violence after three people were killed last week in Bangkok. Thai bonds have rallied even as overseas investors, which hold around 16 percent of the debt, pulled $654 million from the securities this month, exchange data show.
“We see strong demand from domestic investors,” Pareena Phuangsiri, an analyst at Kasikornbank Pcl in Bangkok, said in a May 15 phone interview. “The political unrest weighs on the economy, and when the economy is weak you prefer bonds.”
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