Indonesian Sov Debt Curve Flattens, Yields Lower, Budget Surplus

Indonesian USD sovereign debt curve has bull flattened on Monday, with yields 1-4bps lower across the curve. There has been little in the way of market headlines or economic data releases.

• The INDON sov curve has flattened on Monday with the 2Y yield -2bps at 4.925%, 5Y yield is -3bps at 4.875%, the 10Y yield is -3bps at 4.975%, while the 5-year CDS is also +1bp at 72.5bps
• The INDON to UST spread difference is mostly unchanged from Friday, the 2yr is 32bps (unchanged), 5yr is 68bps (+0.5bp), while the 10yr is 76.5bps (+1bps).
• In cross-asset moves, the USD/IDR is 0.11% higher, the JCI is 0.31% lower, Palm Oil is up 0.73%, while US Tsys yields are flat to 2bps lower.
• Foreign Investors sold bonds again on Thursday now marking 11 of 12 days of net selling. The 5-day average is now -$20m, the 20-day average is -$53m while the longer term 200-day average has turned negative at -$1.95m
• Indonesia reported a state budget surplus of IDR26 trillion in Feb, with state revenue at IDR400.4 trillion and state expenditure at IDR374.3 trillion. Notably, state revenue declined by 4.5% year-on-year, while state expenditure rose by 30.1%. Tax revenue amounted to IDR269 trillion, showing a 3.9% decrease year-on-year, resulting in a budget surplus equivalent to 0.11% of GDP.
• Looking ahead: Indonesia has a very quiet rest of the month in terms of data, with the next major data release not until April 1st