Global Market Update
• US treasury notes yield recorded an increase along the curve ahead of US FOMC meeting.
• The benchmark 10-year UST note yield increased 2 bps on a daily basis to 3.45%.
• Meanwhile the 2-year benchmark yield rose 3 bps to 4.04% at the same time.
• US stock indices were traded mixed. The DJI and S&P 500 rose 0.20% and 0.12% respectively. Yet, Nasdaq Composite weakened 0.13% at the same time.
• Ahead of US FOMC meeting in early May-23, markets are now pricing 92.5% probability of Fed to raise another 25 bps.
• Concerns linger on US debt ceiling development, the Treasury Secretary Janet Yellen warns that US could fail to meet obligations sooner than expected.
• Yellen further noted that the drop in tax receipts has the meaning of hitting debt ceiling as soon as June 1, 2023.
Domestic Market Update
• Domestic markets were closed yesterday commemorating Labor Day.
• The benchmark 10-year (FR0096) yield experienced 1 bps decline to 6.51% on Friday last week.
• The IDR also appreciated against USD and closed at 14,674/USD vs 14,707/USD on the previous day.
• Indonesia’s 5-year CDS slightly dropped and closed at 95.91 bps at the same time.
• Bank Indonesia (BI) reported that foreign net buying in domestic market continued.
• Foreign investors net bought SBN of IDR3.81tn and net purchased equity of IDR2.21tn during 26-27 April last week, bringing the cumulative inflows of IDR6.02tn.
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 6.50-6.70% for today.
• Attractive Indo GB series to be traded today : FR0070, FR0077, FR0044, FR0081, FR0084, FR0086, and FR0088.
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