Global Market Update
• Yield on the benchmark of 10-year UST note climbed 9 bps to 3.58% on Friday (12/09/22).
• Yield on the short term bond (UST 2-year) also increased 4 bps to 4.35% bringing 2/10-year spread at -77 bps.
• US equity fell on the last trading day in the previous week. The DJI dropped 0.90%; S&P 500 declined 0.74% and Nasdaq Composite fell 0.70%.
• US wholesale price rose 0.3% in Nov-22, beating market consensus at 0.2%.
• The Fed is expected to raise FFR to 4.25-4.50% by Dec-22 with the probability of 74.7% according to CME FedWatch.
Domestic Market Update
• The benchmark 10-year Indo GB yield (FR0091) decreased 3 bps to 6.91% on Friday (12/09/22).
• Indonesia’s 5-year CDS is now stood at above 100 bps last week. Risk perception weakened as 5-year CDS increased from 90 bps in the previous week.
• The IDR weakened against USD to 15,583/USD last week vs 15,426/USD on the previous week.
• Bank Indonesia (BI) reported there was a net inflows totaling IDR1.77tn coming from a net buy of IDR8.45tn in government bond and IDR6.68tn net sell in equity market.
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 : FR0070, FR0077, FR0037, FR0042, FR0047, FR0091, FR0096.
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