Company Update

23 November 2021

Fixed Income Report - November 23, 2021

Global Market Update

• The 10-year U.S. treasury yield hiked 8 bps to a level of 1.63% on Monday (11/22/21). U.S. treasury yields followed with an increase of 2-11 bps along the curve after Biden nominated Powell for Fed’s Chair second term.
• U.S. stocks market closed mixed last night with DJI edged up 0.05%. S&P 500, however, dropped of 0.32% and Nasdaq Composite plunged 1.26%.
• U.S. existing home sales slightly rose to an annualized rate of 6.34 mn in Oct-21, equivalent to +0.8% MoM surpassing the consensus estimate of 6.2 mn.
• Federal Reserve Bank of Chicago noted a growth in U.S. national activity index to 0.76 in Oct-21. This figure was significantly higher than the previous month’s figure of -0.18 which also signalled a gradual economic recovery, especially within the industrial production.
• The preliminary reading of Euro Area’s consumer confidence fell to -6.8 in Nov-21, from -4.8 in Oct-21. This downward trend was attributable to arising Covid-19 cases and implementation of lockdowns in some regions.
• China’s loan prime rate left unchanged at 3.85% for one-year and 4.65% for fiveyear as it is announced in its November meeting, in line with market expectation.
• The consumer confidence rate in South Korea jumped to 107.6 in Nov-21, above the Oct-21 of 106.8 and considered as five-month high.
• The flash readings of Australia PMI figures (manufacturing, services and composite) for Nov-21 period continued to strengthen. This was attributable to easing of social restriction along with Covid-19 cases improvement.

Domestic Market Update
• The 10-year Indo GB slightly inched up to 6.03% on Monday (11/22/21) but still in line with our forecast range of 6.00-6.10%.
• The value of Rupiah against USD marginally depreciated to IDR14,248/USD yesterday. Meanwhile, 5-year Indo CDS fell to a level of 76.97 bps.
• Government successfully issued non-tradable Saving Green Sukuk Retail (ST008) achieving the target of IDR5tn before the offering period ended. The total ST008 investors hitting 14,337 marking the second largest investors after ST007 with 16,992 investors.
• Indonesia government bond market recorded a net outflows equivalent to IDR19.57tn during 1-15 Nov-21 as foreign holdings dropped to IDR925.92tn or equivalent to 20.71% from total tradable Indo GB.

Market Projection
• Given the rise in U.S. treasury yields, we expect the 10-year Indo GB yield to edge higher yet remain within range of 6.00 - 6.10% today.
• Attractive Indo GB series to be traded today: FR0086, FR0090, FR0071, FR0078, FR0087, FR0091, FR0068, FR088, FR0083 and FR0092.


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