Global Market Update
• The benchmark 10-year UST note yield was flattish at 3.67% on Thursday (12/22/22).
• The benchmark for short term rate of 2-year maturity rose 3 bps to 4.24%.
• Yield curve inversion widened and the spread of 2/10 year benchmark stood at -57 bps (vs -53 bps the previous day).
• US equities indices took a downturn yesterday. The DJI declined 1.05%; S&P 500 dropped 1.44% and Nasdaq Composite fell 2.18% higher.
• The Central Bank of Turkey maintained a 9% policy rate in Dec-22, in accordance with their previous statement to end rate-cutting, expecting sufficient inflation decline.
• The United States’ GDP rebounded from two quarters of decline with 3.2% QoQ growth in 3Q22 (vs 2.9% consensus) as they secured positive balance of trade and saw rising consumer spending particularly in health care.
• On the other hand, UK’s GDP saw a 0.3% QoQ contraction, while expanding only 1.9% YoY in 3Q22 as business investments and government spending slowed down.
Domestic Market Update
• The benchmark 10-year Indo GB yield (FR0091) slightly increased to 6.78% on Thursday (12/22/22).
• Indonesia’s 5-year CDS came down to 101.98 bps yesterday (vs 104.08 the previous day) following Bank Indonesia’s decision on raising the interest rate.
• The IDR minutely strengthened against the USD and was closed at IDR15,583/USD on Thursday (vs IDR15,588/USD the previous day).
• Bank Indonesia was officially announced to have raised the BI7DRR by 25 bps to 5.50%, as well as the Deposit Facility rate by 25 bps to 4.75% and the Lending Facility rate by 25 bps to 6.25%.
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 6.80-7.00% for today.
• Attractive Indo GB series to be traded today : FR0070, FR0077, FR0081, FR0095, FR0052, FR0073, FR0054, FR0091, FR0096.
Disclaimer On
