Property developer stocks witnessed a substantial increase on Wednesday after the central bank’s decision to cut interest rates.
At 2:21 PM (Bangkok time), the share price of Sansiri Public Company Limited (SET: SIRI) jumped by 3.85% or THB 0.07 to THB 1.89, with a trading value of THB 167.93 million.
Asset World Corp Public Company Limited (SET: AWC) rose by 2.69% or THB 0.10 to THB 3.82, with a trading value of THB 181.79 million.
Land and Houses Public Company Limited (SET: LH) soared by 6.72% or THB 0.40 to THB 6.35, with a trading value of THB 247.59 million.
AP (Thailand) Public Company Limited (SET: AP) increased by 5.64% or THB 0.55 to THB 10.30, with a trading value of THB 153.65 million.
Origin Property Public Company Limited (SET: ORI) gained 8.47% or THB 0.41 to THB 5.25, with a trading value of THB 42.81 million.
Ananda Development Public Company Limited (SET: ANAN) surged by 4.05% or THB 0.03 to THB 0.77, with a trading value of THB 2.77 million.
Supalai Public Company Limited (SET: SPALI) escalated by 4.08% or THB 0.80 to THB 20.40, with a trading value of THB 133.42 million.
This move by the bank was made in an effort to stimulate economic growth amidst increasing concerns about the global economy’s performance. The reduction in interest rates is expected to boost borrowing and spending, which in turn is likely to benefit the property market. As a result, investors showed optimism by driving up the prices of property developer stocks.
Additionally, the lower interest rates could potentially lead to higher demand for properties, further supporting the positive sentiment towards the sector.
In an unexpected turn of events, Thailand’s central bank, the Bank of Thailand (BOT), decided to lower its key interest rate during a policy review on Wednesday. This move, which has been advocated for by the government to stimulate a sluggish economy facing below-target inflation, marks a significant shift in monetary policy.
The BOT’s monetary policy committee, with a 5 to 2 vote, opted to decrease the one-day repurchase rate by 25 basis points to 2.25%. This adjustment comes after maintaining a decade-high rate of 2.50% since September 2023.
The decision to cut the interest rate caught many by surprise, as only four out of 28 economists surveyed by Reuters had anticipated a quarter-point reduction this week. Conversely, the majority of economists, numbering twenty-four, had expected no alterations to the existing policy.
The last modification in policy occurred in September of the preceding year when there was a 25 basis point increase in the interest rate. The recent rate cut reflects the BOT’s proactive approach to addressing economic challenges and fostering growth in the face of prevailing economic conditions.
