Rupiah Dips On Tighter Indonesia/U.S. Yield Spreads Despite Rebound In Palm Oil

Spot USD/IDR operates at IDR15,593, up 41 figs on the day. Familiar technical contours remain in play, Bulls look for a breach of Oct 21 cycle high of IDR15,634, while bears keep an eye on Oct 5 low of IDR15,162.

• USD/IDR 1-month NDF last +33 figs at IDR15,607. Topside focus falls on Oct 21 high of IDR15,674, while bears take aim at Oct 26 low of IDR15,490.
• Foreign investors were net buyers of $93.65mn in Indonesian stocks last Friday, bringing the YtD inflows to 5.504bn. The Jakarta Comp traded on a softer footing, but rebounded this morning, albeit it remains sandwiched between the 100-DMA and 50-DMA.
• Indonesia/U.S. yield spreads tightened into the weekend, which extends into the new week. 5-Year differential falls deeper below 300bp, while 10-year spread stabilises just shy of 350bp.
• INDOGB yield curve has moved away from cyclical narrows and returned above 40bp.
• Palm oil futures bounced in morning Kuala Lumpur trade and last change hands +MYR193/MT, with eyes on resistance from the descending 100-DMA. The aggregate Bloomberg Commodity Index sits ~0.8% higher on the day.
• The latest round of Indonesia's monthly CPI figures will hit the wires tomorrow. Headline inflation may have accelerated to +5.99% Y/Y last month from +5.95% prior, while core inflation is expected to have quickened to +3.40% from +3.21%.