Company Update

22 Juni 2022

Fixed Income Report June 22, 2022

Global Market Update
• The benchmark 10-year UST note yield rose 5 bps to 3.28% to start this week on Tuesday (06/21/22).
• Majority of US government bond yields increased 2-7 bps along the curve.
• US equity indices start this week with positive performance. The all 3 benchmark indices (DJI, S&P 500 and Nasdaq Composite) were up more than 2%.
• Eurozone government bond yield continued to increase. Yield on 10-year government bond of UK and Germany rose by 5 bps and 2 bps respectively.
• Market focus is now on Fed’s chair Powell monetary policy report to congress this Wednesday (06/22/22).

Domestic Market Update
• The benchmark 10-year Indo GB yield (FR0091) was closed 1 bps lower to 7.47% on Tuesday (06/20/22).
• The IDR started to strengthen against USD and was closed at IDR14,813 yesterday vs IDR14,836 in the previous day.
• Indonesia’s risk premium 5-year CDS continued to decline and was closed at 104.44 bps yesterday from 106.46 bps in the previous day.
• Government has conducted SUN auction yesterday. The incoming bid value in the SUN auction reached IDR35.06 trillion and the nominal won was IDR18.88 trillion.
• The incoming bid value was lower than the previous auction of IDR43.54 trillion in line with our expectation as investors tend to wait and see amid rising UST yield.
• Market also focus on BI’s meeting that will be held this week and majority expect domestic central bank to hold policy rate at 3.5%.

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 7.30-7.50% for today.
• Attractive Indo GB series to be traded today : FR0063, FR0081, FR0084, FR0090, FR0047, FR0052, FR0054, FR0091.

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