Global Market Update
• The benchmark 10-year UST note yield was down by 4 bps to 2.92% on Friday (07/15/22).
• Meanwhile the benchmark for shorter rate 2-year UST note yield fell 1 bps to 3.13%
• The spread between 2-10 year UST note yield widened in negative territory to -21 bps.
• US equity indices jumped, with S&P 500 and Nasdaq Composite rose 1.92% and 1.79% while DJI was up 2.15%.
• Investors focus now on Fed’s FOMC meeting and expect US CB to raise another 75 bps this time.
Domestic Market Update
• The benchmark 10-year Indo GB yield (FR0091) rose 3 bps to 7.37% on Friday (07/15/22).
• The IDR was closed at IDR14,997/USD last week after previously hitting IDR15,020/USD.
• Indonesia’s risk premium 5-year CDS continued to increase and was at 164.43 bps last week.
• Indonesia booked a trade balance surplus of USD5.09bn in Jun-22, higher than consensus estimate of USD3.48bn.
• Exports jumped 40.68% YoY, while imports grew 21.98% YoY in Jun-22, and causing a trade balance surplus for 26-straight months.
• Widening trade balance surplus was also caused by government lift off CPO exports ban,
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 7.20-7.40% for today.
• Attractive Indo GB series to be traded today : FR0063, FR0070, FR0077, FR0056, FR0078, FR0052, FR0073, FR0091.
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