Global Market Update
• The 10-year UST yield jumped 13 bps to 2.83% on Thursday last week (04/14/22).
• Yield on US government bonds rose 6-13 bps along the curve last week as market prepare to anticipate more aggressive tightening potential.
• On the data front, US retail sales grew 0.5% MoM in Mar-21, below the previous month and consensus at 0.8% and 0.6% respectively.
• The University of Michigan consumer sentiment for the US rose to 65.7 in Apr-22 from an eleven-year low of 59.4 in Mar-22, according to preliminary estimate.
• ECB kept the interest rate unchanged at 0%. Meanwhile ECB monthly net purchases under the APP will amount to EUR40 billion in April, EUR30 billion in May and EUR20 billion in June.
• ECB President Christine Lagarde said that the end date for APP has not been determined.
Domestic Market Update
• Yield on 10-year Indo GB increased by 1 bps to 6.92% on Thursday (04/14/22) or +1 bps above our target range.
• The IDR weakened against USD and was closed at IDR 14.381/USD yesterday (vs IDR14,363/USD last week).
• Risk premium which is reflected by the 5-year Indo CDS also gradually rose to 88.18%..
• Indonesia's trade balance is projected to have a surplus of USD2.89 billion in Mar-22, supported by higher exports than imports (exports : +23.8% YoY; imports : +18.3% YoY).
• Export performance remained solid, supported by persistently high global commodity prices. The continued surplus in the trade balance served as a positive catalyst for Rupiah stability and inflows of foreign funds, especially to the domestic stock market.
Market Projection
• Given the recent development on global and domestic market, we expect the 10 year Indo GB yield to keep steady within a range of 6.80-6.90% for today.
• Attractive Indo GB series to be traded today : FR0070, FR0086, FR0090, FR0071, FR0078, FR0087, FR0091.
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