Global Market Update
• US treasury notes yield recorded an increase along the curve on Friday (04/14/23).
• The benchmark 10-year UST note yield increased 7 bps to 3.52% on Friday last week.
• Meanwhile, the benchmark 2-year UST note yield jumped 13 bps and climbed back above 4.00%.
• US equity indices closed the week with correction. The DJI fell 0.42%; S&P 500 dropped 0.21% and Nasdaq Composite weakened 0.35%.
• Despite US inflation is slowing down and came to 5.0% YoY in Mar-23, Fed’s FOMC meeting showed that US central bank still need to firming their policy.
• According to CME FedWacth tools, markets are betting Fed to raise another 25 bps by 82.1% probability on May 3, 2023.
Domestic Market Update
• The domestic LCY government bonds were traded mixed on Friday (04/14/23).
• Yield on the benchmark 10-year (FR0096) increased 2 bps to 6.63% on Friday last week.
• The IDR continued to strengthen against USD and closed at IDR 14,705/USD on Friday.
• Indonesia’s 5 year CDS is consistently declining and now stood below 90 bps or precisely at 88.67 bps.
• Bank Indonesia reported a foreign net buying of IDR8.21tn in the domestic financial market during 10-13 April 2023.
• Foreign net buying came to both government bond (IDR5.12tn) and equity market (IDR3.10tn).
• Markets also await Indonesia’s Mar-23 trade balance which consensus expect to record another surplus yet with a lower magnitude given the probability of contracted imports and exports.
Market Projection
• Given the recent development on global and domestic market, we expect the 10 year Indo GB yield to move within a range of 6.60-6.80% for today.
• Attractive Indo GB series to be traded today : FR0063, FR0070, FR0077, FR0084, FR0045.
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