Company Update

12 Agustus 2022

Fixed Income Report August 12, 2022

Global Market Update
• The benchmark 10-year UST note yield rose 10 bps to 2.89% on Thursday (08/11/22).
• Meanwhile the benchmark 2-year UST note yield was up 1 bps to 3.23% at the same time.
• Yield curve remained inverted but the spread between 2/10-year UST note narrowed to -34 bps.
• UST note yield for longer maturity rose 8-11 bps along the curve.
• US stock indices closed mix. DJI rose marginally by 0.08%, whereas S&P 500 was down 0.07% & Nasdaq Composite lost 0.58%.
Domestic Market Update
• The benchmark 10-year Indo GB yield (FR0091) fell 13 bps and closed at 6.95% on Thursday (08/11/22).
• Yield on the benchmark government bond declined to the lowest position in the last two months along with IDR appreciation & the drop in risk premium.
• The IDR rose against USD and was closed at IDR14,776/USD on Thursday (vs IDR14,871/USD on Wednesday).
• Indonesia’s 5-year CDS recorded a decline to 104.94 bps on Thursday (vs 108.99 bps on Wednesday).
• The pressures on government bond continued to ease as US inflation and Fed’s action have been already priced in.
• The foreign ownership of SBN increased by IDR10.72tn to IDR761.96tn indicating an inflows.
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 6.90-7.10% for today.
• Attractive Indo GB series to be traded today : FR0063, FR0070, FR0077, FR0037, FR0090, FR0052, FR0085, FR0073, FR0054 and FR0091.
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