Indon Sov Debt Yields Push1-3bps Higher, Foreign Investors Sell Bonds

Indonesian USD sovereign debt curve bear steepened the past week with yields 7-15bps higher, significantly out-performing the moves in US Treasuries, which finished the week 20-30bps wider. Palm Oil prices hit new multi-year highs earlier, although we trade unchanged for the day now.

• To start the week off curves are flatten with yields 1-3bps higher continuing their trend from last week, the 2Y yield is 1bp higher at 4.97%, 5Y yield is 2.5bps higher at 4.995%, the 10Y yield is 2.5bps higher at 5.09%, while the 5-year CDS is up 0.5bp to 69bps.
• The INDON to UST spread difference has closed over the past week, with the front-end INDON curve out-performing although it has lagged the moves tighter made by the PHILIP curve the 2yr is 25bps, 5yr is 68bps, while the 10yr is 78bps.
• In cross-asset moves, the USD/IDR is 0.47% higher, the JCI is 0.25% higher, Palm Oil is up 0.05%, while US Tsys yields are mostly unchanged
• Foreign Investors continue to sell Indonesian debt with Thursday marking the 6th consecutive day of selling. The 5-day average is now -$137m, while the 20-day average is $64m while the longer term 200-day average now sits at just $0.005m
• Looking ahead: Wednesday BI Rate decision, expected to hold steady at 6.00%