HIGHLIGHTS
- Yield of 10-year Indonesia Government Bonds is 6.909% on July 31, 2024, vs 6.936% the day before. Meanwhile yield UST 10-year fell to 4.09%, from 4.15% the day before.
- Government bonds volume was IDR29.04 trillion, and it was dominated by medium term (5-15 years). It was dropped than the previous day transaction of IDR45.88 trillion. The volume lower than its YTD average of IDR44.83 trillion. While the outright transaction reached IDR14.77 trilion declined from the previous day's transaction which amount to IDR18.33 trilion.
- Meanwhile, the total volume of corporate bonds was recorded at IDR3,191 billion, dominated by short term (< 5 years). The transaction volume increased compared to the previous day's volume of IDR3,187 billion. The volume higher compared to this year's average of IDR1,983 billion. Meanwhile, outright transaction recorded at IDR2,691 billion declined from the previous day's transaction of IDR3,186 billion.
- The Rupiah exchange rate against the US Dollar strengthened by 0.25% to IDR16,260 from IDR16,300 while the JCI advanced 0.19% from 7,242 to 7,256. Then Brent fell from 80.84 to 79.22 USD per barrel, while WTI Cushing Crude Oil Spot price fell from 75.81 to 74.73 USD per barrel.
GLOBAL UPDATES
- Bank of Japan (BoJ) raised their policy rate to around 0.25% from 0.1%, basing on the recent economic activity and prices that’s been “developing generally inline with the Bank’s outlook”. BoJ also noted that the import price growth has turned positive and posed risk for further inflation. Accompanying the rate hike is the reduction of the monthly size of JGB purchase by BoJ. Starts from Aug-24, the monthly purchase will decrease to JPY5.3tn and gradually reduced by JPY400bn per quarter until it reach JPY2.9tn/month in Apr-26. (Bank of Japan)
- Eurozone inflation tick up in Jul-24 to 2.6% y-y (vs. Jun's 2.5%) with core inflation remain unchanged at 2.9% y-y. Both figures came above expectations. Service inflation, one indicator that remain elevated, fall for the first time in three months to 4% y-y. (Bloomberg)
- The Fed leave the rate unchanged at 5.25-5.50%. Overall ton remain neutral with emphasize on balancing risks between cutting too soon or too late. The Fed Chair Jerome Powell stated that inflation has eased substantially and the labor market have returned to the eve of the pandemic with no significant inflationary pressure. He also said that there's a possibility of September rate cut and current scenario could be everywhere from no rate cut to several rate cuts. (FOMC)
DOMESTIC UPDATES
- July's inflation will be announced today at 11am. We expect further deceleration to 2.18% y-y (Cons: 2.37%) from Jun's 2.51% for the headline figure. For core inflation, we expect the y-y number at 1.89% y-y (vs. cons: 1.90%), a slight decrease from Jun's 1.9%
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