A meeting of the Federal Open Market Committee (FOMC) of the Federal Reserve (Fed) will take place on September 16-17 to consider adjusting the policy interest rate.
Analysts from Bualuang Securities (BLS) expected the Fed to cut the interest rate by 0.25 percentage points to 4-4.25%. Meanwhile, the CME FedWatch Tool recently indicated that investors currently assign a 93% probability for the Fed to lower the rate by 0.25 percentage point, and a 7% probability for a 0.50 percentage point cut. For the month of October and December 2025, a further 0.25 percentage point cut is anticipated each month.
Apichat Poobunjirdkul, CISA, Senior Director of Strategic Analysis at TISCO Securities, stated that the Fed has a chance to lower the interest rate this week but advised closely monitoring the “Dot plot,” a tool used to consider the direction of interest rates, to gauge how the outlook may turn out.
The market generally expects the Fed to cut interest rates three times in the remainder of 2025 and two more times in 2026, which is more than the prior indication given by the Fed in June 2025, when the Fed suggested there could be two cuts this year and two in 2026. If the Dot plot remains the same, there could be some profit-taking in the market.
Nonetheless, he believes that the Fed is unlikely to lower rates as quickly as the market expects.
As for U.S. bond yields, they have dropped to around 4%, the lowest in six months, which is a positive sign for the stock market. However, if bond yields spike, it will impact equities as well. Thus, the SET Index needs to hold above 1,300 points for now, with the next resistance level at 1,320 points, and the market remains in a sideways to sideways-up pattern.
With respect to stocks that benefit from a downward interest rate cycle, the finance, power plant, and high dividend-yielding stocks are attractive investments.
The recommended stocks with strong fundamentals include Tidlor Holdings Public Company Limited (SET: TIDLOR)—currently under target price review; Muangthai Capital Public Company Limited (SET: MTC), with a target price of THB 53; Global Power Synergy Public Company Limited (SET: GPSC), with a target price of THB 49; Gulf Development Public Company Limited (SET: GULF), with a target price of THB 58; and Electricity Generating Public Company Limited (SET: EGCO), with a target price of THB 132.
Benjaphol Suthwanish, Deputy Managing Director, Securities Analysis Division at UOB Kay Hian Securities (Thailand), also had a similar view.
For stock investment strategy, he suggested focusing on groups that benefit from lower interest rates and a strengthening baht, especially companies with high debt, such as power plant stocks. Recommended were B.Grimm Power Public Company Limited (SET: BGRIM), with a target price of THB 18;GPSC, with a target price of THB 45; Banpu Power Public Company Limited (SET: BPP), with a target price of THB 9; and PTT Public Company Limited (SET: PTT), with a target price of THB 37.
