Supply Dynamics

Yields mostly higher amid positive sentiment and strong data from the region. Supply dynamics continue to be a focus.

• INDIA: Yields mostly higher, it was announced yesterday that India would issue INR 7.24tn of government debt in the first half of FY 2021, that equates to around 60% of the full-year target. Auctions are likely remain under pressure looking forward, price action will be dictated by the type and frequency of OMOs.
• INDONESIA: Yields mixed across the curve, Indonesian bonds are expected to come under pressure as auctions continue to be poorly received, yesterday Indonesia sold IDR 15.02tn of debt under the greenshoe option, missing the maximum target of IDR25.25tn. It was reported earlier that Indonesia targets sales of IDR 230tn of sukuk bonds, assuming weekly sales that equates to approximately IDR 17tn per week. CPI was slightly below estimates.
• CHINA: The PBOC matched maturities with injections again today, the nineteenth straight day of matching maturities, while the bank hasn't injected funds since February 25. Repo rates have risen again after moving higher heading into month/quarter end yesterday. Futures are broadly flat, moving out of negative territory following the weak PMI print. Caixin China PMI Manufacturing fell to 50.6 in March from 50.9, below estimates of 51.4. The figure denotes an 11-month low point, the findings contrast with those in an official survey which showed manufacturing activity grew at a stronger pace
• SOUTH KOREA: Bond futures are lower amid positive sentiment in the region. Data was positive, the trade surplus widened slightly less than expected, but printed a robust $4.175bn, exports rose 16.6%, in line with estimates, while imports rose 18.8% against expectations of a 19.1% rise. The jump in exports is the most since 2018, chips and automobiles continue to lead the export rally. South Korea Markit PMI Manufacturing was also released, the print was in line with the previous at 55.3 and firmly in expansionary territory. Markets await the April issuance plan.