Company Update

29 Februari 2024

Fixed Income Report February 29, 2024

Global Market Updates
• Wall Street equities ended flat with minor losses on Feb 28, with the DJI inched down by -0.06%, the S&P 500 fell by -0.17%, while the Nasdaq closed down by -0.55%.
• Stock indexes fell moderately on Wednesday due to selling pressure from recent highs. Investors were cautious ahead of Thursday’s PCE deflator report, expecting the Jan core PCE deflator to ease to 2.8% YoY from December's 2.9%. Q4 GDP was revised lower, but personal consumption was revised higher. Lower bond yields supported stocks.
• US Treasury 10-yr yields fell by -4.0 bps to 4.27% followed by 2-yr yields slipped by -6.0 bps at 4.70% on Wednesday. Investors awaited key economic data, pondering upcoming monetary policy moves, particularly interest rates.
• US weekly MBA mortgage applications for the prior week fell by 5.6% to a 3-month low. The mortgage purchase sub-index dropped 4.5% to a 4-month low, and the refinancing sub-index fell 7.3%. The average 30-year fixed mortgage rate decreased by -2 bps to 7.04% from the prior week's 7.06%.
• US Q4 GDP revised down to +3.2% from the previously reported +3.3%. Q4 personal consumption revised up to +3.0% from +2.8%, beating expectations of +2.7%. Also, the Q4 core PCE price index was revised up to +2.1% from +2.0%.
• Global bond yields were mostly down on Wednesday; The German bund 10-yr yield fell by -0.5 bps to 2.46%, and the UK gilt 10-yr yield slipped by -1.1 bps to 4.18%. The Japanese JGB 10-yr yield rose by +0.70 bps to 0.70%.

Domestic Market Updates
• Indonesian benchmark series of LCY government bonds closed lower on Wednesday (Feb 28, 2024), with the 10-yr benchmark yield rose +1.57 bps to 6.59%.
• The IDR continued weaken against the USD (USD/IDR rose by +0.29% to 15,685). The Rupiah has been under pressure, and now its movements are now closely tied to the US economic data that will be released this week.
• Secretary Moegiarso announced the revision of PP No. 123 of 2015 on export taxes. This revision evaluates the effectiveness of PP No. 36 of 2023 on Foreign Exchange from the Export of Natural Resources (DHE) and aims to provide more attractive tax incentives to exporters.
• The government will conduct an SBSN auction on Tuesday, March 5, featuring a series of SPNS 03092024 (new issuance), SPNS 02122024 (new issuance), PBS032 (reopening), PBS030 (reopening), PBS004 (reopening), PBS039 (reopening), and PBS038 (reopening) with an indicative target of IDR12tn.

Market Forecast
• Given the recent developments that unfolded within the global and domestic markets, we expect the 10-yr Indo GB yield to move within the range of 6.50-6.65% for today.
• Attractive Indo GB series to be traded today : FR0081, FR0099, FR0071, FR00101, FR0075, FR0083, FR0076.

Disclaimer On

FR81 FR99 FR71 FR101 FR76 FR83 FR76

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