Global Market Update
• Yield of US government bond continued to increase and hitting its highest level in the last decade starting this week.
• The benchmark 10-year note yield increased 7 bps to 3.95% on Tuesday (09/27/22).
• On the other hand, the 2-year benchmark declined 3 bps to 4.28% at the same time after hitting its level high since Oct-07.
• Spread between 2/10-year UST note yield was at -33 bps or narrowing from the previous day position at -43 bps.
• US stock indices closed mixed on Tuesday. The DJI and S&P 500 fell 0.43% & 0.21% respectively, whilst Nasdaq Composite rose 0.25%.
• In UK, its benchmark government bond yield also continued to climb higher. Now for UK’s 10-year benchmark rate hit 4.50% or rising 26 bps from the previous day.
Domestic Market Update
• The benchmark 10-year Indo GB yield (FR0091) stayed flat at 7.35% on Tuesday (09/27/22).
• Indonesia’s 5-year CDS was still around 150 bps or precisely at 149.82 bps yesterday.
• The IDR strengthened slightly against USD and was closed at IDR15,123/USD yesterday (vs IDR15,128/USD on Monday).
• The Ministry of Finance reported that the budget surplus reached IDR107.4 trillion (0.58% of GDP) until August 2022.
• The surplus was driven by state revenue which grew 49.8% YoY to IDR1,764,4 trillion and state expenditure which grew 6.2% YoY to IDR1,657 trillion.
• Government of Indonesia has issued 7 series of SUN amounting IDR10.75tn on yesterday’s auction. This figure was lower than the indicative target of min IDR19tn.
• The incoming bids were recorded at IDR23.67tn or significantly lower than in the previous auction of IDR52.06tn.
• Furthermore, Government of Indonesia has issued two series of SUN VR0086 & VR0087 amounting IDR16.58tn through private placement in accordance to SKB III.
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 7.25-7.45% for today.
• Attractive Indo GB series to be traded today : FR0063, FR0070, FR0077, FR0081, FR0086, FR0090, FR0064, FR0095, FR0071, FR0078, FR0091.
Disclaimer On
