Global Market Update
• Yields on the benchmark UST note decreased along the curve on Wednesday (02/22/23).
• The benchmark 10-year yield declined 4 bps to 3.92%, while the shorter benchmark of 2-year yield was also 4 bps lower and closed at 4.69% at the same time.
• Previously US government bond yields hit the highest level since Nov-22 as markets continue to assess Fed’s hike probability.
• US stock indices were mixed yesterday. The DJI and S&P 500 each fell 0.26% and 0.15%, while Nasdaq Composite increased 0.13%.
• US tech stock index again showed a more sensitive movement driven by the government bond yields change.
• Market participants will look at FOMC minutes of meeting published today to get the hint of further Fed’s monetary policy.
• Elsewhere in Germany, the annual inflation rate hit 8.7% in Jan-23 which came in-line with the broad market expectation.
Domestic Market Update
• Yield on the benchmark 10-year (FR0096) increased 2 bps to 6.75% on Wednesday (02/22/23).
• The IDR weakened against USD and was closed at IDR15,200/USD after previously closed at IDR15,190/USD.
• Indonesia’s 5-year CDS finally hitting 100 bps again. Indonesia’s 5-year CDS stood at 101.16 bps.
• MoF reported the state budget posted a surplus of IDR90.8tn in Jan-23 (0.4% GDP) driven by higher revenue which hit IDR232.2tn while government expenditure totaled IDR141.4tn
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 6.70-6.90% for today.
• Attractive Indo GB series to be traded today : FR0063, FR0046, FR0070, FR0077, FR0081, FR0096.
Disclaimer On
