Global Market Update
• The benchmark 10-year UST note yield was up by 7 bps to 2.99% to start this week.
• Meanwhile the benchmark for shorter rate 2-year UST note yield rose 5 bps to 3.18%
• The spread between 2-10 year UST note yield was still in negative territory at -19 bps.
• DJIA weakened by -0.69% on Monday (18/07), followed by S&P 500 (- 0.84%) and Nasdaq (-0.81%).
• Wall Street was under pressure as investors watched the release of the NAHB housing market index data on Jul-22 at 55 or lower than 67 on Jun- 22.
• Meanwhile investors focus remain on Fed’s FOMC meeting that is expected to raise interest rate again in Jul-22.
Domestic Market Update
• The benchmark 10-year Indo GB yield (FR0091) was flat 7.37% on Monday (07/18/22).
• The IDR was closed at IDR14,981/USD yesterday or strengthening from IDR14,997/USD last week.
• Indonesia’s risk premium 5-year CDS continued fell to 157.25 bps from previously above 160 bps.
• Domestic investors focus on BI’s meeting this week. Consensus still expect that domestic central bank will hold 7-day reverse repo rate at 3.5% this time.
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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