Company Update

24 November 2022

Fixed Income Report November 24, 2022

Global Market Update
• The benchmark 10-year UST note yield dropped 7 bps to 3.69% on Wednesday (11/23/22).
• On the other hand, the benchmark for short term rate of 2-year maturity declined 4 bps to 4.48% at the same time.
• Yield curve inversion widened and the spread of 2/10 year benchmark stood at -79 bps yesterday (vs -76 bps in the previous day).
• US equity indices extended gain yesterday. The DJI increased 0.28%; S&P 500 rose 0.60%; Nasdaq Composite rose 0.99%.
• Pressures on financial market ease as majority of Fed’s officials agreed on the interest rate hikes pace moderation soon.
Domestic Market Update
• The benchmark 10-year Indo GB yield (FR0091) decreased 6 bps to 6.95% on Wednesday (11/23/22).
• Risk perception slightly improved and IDR appreciated against USD yesterday.
• Indonesia’s 5-year CDS stood at 108.06 bps yesterday (vs 112.01 on the previous day).
• The IDR strengthened against USD and was closed at IDR15,687/USD on yesterday (vs IDR15,697/USD on the previous day).
• Bank Indonesia (BI) reported money supply (M2) grew +9.8% YoY in Oct- 2022 (vs +9.1% YoY in Sep-2022).
• Money supply growth was mainly influenced by credit distribution. BI reported that lending in Oct-2022 grew expansionary to +11.7% YoY (vs +10.8% YoY in Sep-2022).
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 7.00-7.20% for today.
• Attractive Indo GB series to be traded today : FR0070, FR0077, FR0081, FR0064, FR0095, FR0091, FR0096.
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