• Wall Street equity indexes rallied concluding last week’s euphoric spur as markets discern the dovish macro backdrop and not wanting to miss out on the 3Q earnings season rally bandwagon; DJI was up 0.66%, S&P 500 0.94% and Nasdaq jumped 1.38%.

• Buoyant market sentiments dragged down the VIX by 4.8% lower to land at 14.91, and calmed the Treasury market’s volatility, MOVE, down to 118.74 or down 6.24% MoM.

• The US Oct-23 unemployment data released Friday further advocated the narrative of no further rate hikes necessary, rising 0.1% to 3.9% instead of the expected flat 3.8%. Moreover, the weaker-than-expected Oct-23 payrolls rise by only 150k as opposed to 180k pronounced holes within the labor market.

• The waning service sector also pushed for a dovish policy, as the Oct-23 ISM services fell deeper to 51.8 vs the anticipated 53.0, accompanied by a down-revised Oct-23 final services PMI to 50.6.

• The UST 10-yr yield plummeted by 10 bps to reach 4.57%, followed by the 2-yr yield’s slide to 4.84%, leaving the inverted curve at -26 bps.

• Last week’s market closing on a conducive note should support the demand-side to absorb this week’s USD112bn worth of Treasury issuances for 3-yr, 10-yr and 30-yr; we can expect yields to glide lower on the momentum.

• Indonesian benchmark series of LCY government bonds further strengthened Wednesday (Nov 3, 2023), with the 10-yr benchmark series yield falling 21 bps to land at 6.84% once again.

• IDR continued its appreciation against USD (USD/IDR slipped -0.81% to 15,728); DXY’s momentum further slowed post dovish US unemployment rates development.

• The 5-yr CDS continued to close lower, last was by 3.3% down to 87.69, reflecting the predisposition of investors to willingly take on more risks.

• This has been shown in Friday’s (Nov 3) SRBI auction that raked in a total of IDR10.1tn awarded bids, as opposed to the previous week’s dull IDR3tn.

• The sanguine rally momentum for USTs last week should bode well for the health of Indonesian SBN flows as well; we can expect markets to be more willing in absorbing SBN/SBSN issuances.