Global Market Update
• US government bond yields falling after experiencing a spike before and yield curve inversion narrowed
• The 2/10-year yield spread is currently stood at 97 bps, better than previous day of 108 bps
• Government bond yield on the benchmark 10-year fell 8 bps and closed at 3.91%.
• On the other hand, the benchmark 2-year yield dropped 19 bps and closed at 4.88% after hitting above 5% on the previous day.
• In spite of narrowing yield curve inversion, US tock indices fell on Thursday (03/09/23).
• The DJI was 1.66% lower whereas S&P 500 and Nasdaq Composite declined 1.84% and 2.05% respectively.
• US reported initial jobless claims hitting 211k as per 4 March 2023, beating consensus estimate of 195k and previous period of 190k.
Domestic Market Update
• Most of domestic currency government bond prices increased on Thursday (03/09/23).
• Yield on the benchmark 10-year (FR0096) declined 4 bps and falling below 7.00%.
• The IDR strengthened marginally against USD and closed at 15,433/USD yesterday (vs IDR15,438/USD on the previous day).
• On the other hand, Indonesia’s 5-year CDS was flattish and closed at 93.60 bps yesterday.
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 6.90-7.10% for today.
• Attractive Indo GB series to be traded today : FR0046, FR0070, FR0077, FR0044, FR0081, FR0086, FR0096, FR0098.
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