Uncertainty Grips Thai Markets With New Government in Limbo

(Bloomberg) — Volatility is rising in Thailand’s financial markets amid concern investors will have to wait until August to find out whether a coalition of pro-democracy parties can form a new government.

Most Read from Bloomberg

Uncertainty after the May 14 election first triggered an outflow of funds, worsening the rout in Asia’s worst-performing stock market this year and weakening the baht. Stocks then rallied this week, and the currency retraced some of its losses Wednesday.

While the new coalition formalized its alliance Monday, when a quarterly economic report showed better-than-expected growth, there is concern that funds will keep taking money out of the country until there’s clarity on the new leadership.

“This is a classic case of politics getting in the way of an economic rebound in the making, which would certainly have been bullish for Thai assets,” said Vishnu…