Regional Yields Lower Ex Korea

INDIA

• PMIs came in ahead of surveys as manufacturing surged in July.
• Following a moderation of business confidence in June, July PMIs saw monthly manufacturing and services output expand.
• This may possibly likely reflect the end of the election cycle and the expectations of supportive measures from the budget (now released).
• Bonds performed well on the day given the news of the forecast narrowing of the fiscal deficit.
• 2yr 6.85% (-2.5bp) 5yr 6.899% (-2bp) 10yr 6.965% (-0.5bp) 30yr 7.039%

INDONESIA

• Auctioned multiple new issues across the curve in the 2029, 2043, 2038, 2034, 2054 maturities.
• Relative to secondary market trading new issues were priced with a new issue concession of 2-3bps to existing securities.
• Demand for Indonesian debt at auction jumped to the highest since January as investors returned following a selloff over fiscal worries and as bets solidify the central bank may have ended its hiking cycle.
• Bond market absorbed the new issue easily with limited movements across the maturity curve.
• 2yr 6.612% 5yr 6.803% 10yr 6.972% 30yr 7.084%

SOUTH KOREA

• Short end bonds bucked the regional trend of lower yields, moving 3-5bps wider on the day, as bonds across the curve finished 1-4bps lower in yield.
• Short end moves were likely driven by the unwind of expectations of an August rate cut as better than expected housing data in Seoul showed house prices rebounding.
• 2yr 3.209% (+5bp) 5yr 3.08% (-1.5bp) 10yr 3.152% (-3bp) 30yr 3.01(-4bp)