Company Update

06 Maret 2023

Fixed Income Report March 6, 2023

Global Market Update
• Yield on the US treasury notes finally falling along the curve on the last trading day of previous week.
• The benchmark 2-year note yield dipped 3 bps to 4.86% whereas 10-year yield inched 10 bps lower and finally fall back to below 4% at 3.96% on Friday (03/03/23).
• US stock indices closed higher as UST note yields fell. The DJI closed 1.17% higher while S&P 500 and Nasdaq Composite strengthened 1.61% and 1.97% respectively.
• Market moved in response to stronger than expected US ISM Non- Manufacturing PMI which came at 55.1 in Feb-23, beating consensus estimate at 54.5 yet slightly lower than previous month figure of 55.2.
• The benchmark 10-year government bond yields across Euro Area also declined backed by lower than expected PPI.
• EA reported a decline in month-on-month PPI of 2.8%, lower than market expectation at 0.3% decrease and bringing annual PPI to rise by 15%.

Domestic Market Update
• Yield on the benchmark 10-year (FR0096) increased 2 bps to 6.96% on Friday (03/03/23).
• The IDR government bond prices closed mixed amidst on-going pressures on IDR while risk perception keeps moving lower.
• The IDR weakened against USD and was closed at IDR15,311/USD on the last trading day of previous week after previously closed at IDR15,281/USD on Thursday.
• Indonesia’s 5-year CDS stayed below 100 bps but declining nearly 3 bps to 90.85 bps last week.
• Bank Indonesia (BI) reported that foreign investors net sold government bonds (SBN) worth of IDR4.67tn during 27 Feb – 2 Mar, whereas net bought equity worth of IDR3.29tn at the same 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 6.80-7.00% for today.
• Attractive Indo GB series to be traded today : FR0046, FR0070, FR0077, FR0044, FR0081, FR0086, FR0096, FR0098.

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