Rising US Treasury yields have rattled bond markets worldwide, and Thailand's Public Debt Management Office is preparing to adapt. Speaking to reporters in Bangkok on Tuesday, Director-General Jindarat Viriyataveekul said officials are studying demand across maturities and may lean toward issuing shorter-tenor paper at the outset. "This is a challenge for us, as the global market is quite volatile," Jindarat said.
The PDMO is considering a heavier mix of promissory notes, term loans and treasury bills while it gauges investor appetite. Jindarat outlined a two-step playbook: raise and roll near-term funding first, then shift that borrowing into longer-term securities once conditions look friendlier.
Thailand plans to sell 1.26 trillion baht in fresh debt in fiscal 2027, or about $37.5 billion. Public debt is projected to rise to 69.7% of gross domestic product, with the debt ratio likely topping out in fiscal 2028 while staying under the 70% limit set in the fiscal framework. Because roughly 89% of existing obligations are long-term, Jindarat said the jump in global yields should have only a muted effect on the current portfolio. The government's average interest cost is around 2.6%, little changed from a year ago, and she expects only a small uptick next year given that the amount of new issuance is not especially large.
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Shorter funding at the government level can be a sign of flexibility rather than stress, especially if most old debt is locked in at low rates. If markets settle and Thailand lengthens maturities later, that would smooth out refinancing risk. For savers and investors watching from the sidelines, the headline is simple: volatility abroad is steering issuance strategy at home, but officials still expect only a modest rise in borrowing costs.
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