HIGHLIGHTS
- Yield of 10-year Indonesia Government Bonds is 7.029% on May 14, 2024, vs 6.987% the day before. Meanwhile, the 10-year U.S. Treasury yield decreased to 4.45%, from 4.48% the previous day.
- Government bonds volume was IDR69.81 trillion, and it was dominated by short term (< 5 years). It was was up than the previous day transaction of IDR63.93 trillion. The volume higher than its YTD average of IDR44.83 trillion. While the outright transaction reached IDR37.74 trilion advanced from the previous day's transaction which amount to IDR13.13 trilion.
- Meanwhile, the total volume of corporate bonds was recorded at IDR2,618.48 billion, dominated by short term (< 5 years). The transaction volume declined compared to the previous day's volume of IDR2,706.71 billion. The volume higher compared to this year's average of IDR1,982.85 billion. Meanwhile, outright transaction recorded at IDR2,615.48 billion declined from the previous day's transaction of IDR2,679.71 billion.
- The Rupiah exchange rate against the US Dollar weakened by 0.15% to IDR16,104 from IDR16,080 while the JCI declined -0.22% from 7,099 to 7,084. Then Brent dropped from 83.11 to 82.12 USD per barrel, while WTI Cushing Crude Oil Spot price increased from 78.26 to 79.12 USD per barrel.
GLOBAL UPDATES
- Federal Reserve Chair Jerome Powell said the US central bank needs to be patient as it awaits more evidence that high interest rates are curbing inflation, doubling-down on the need to keep borrowing costs elevated for longer. (Bloomberg)
- The UK's unemployment rate rose to 4.3% between January and March 2024. Wages increased by 6% year-on-year, maintaining the same growth rate as the previous months. The continuous cooling of the labor market supports the case for a rate cut by the Bank of England as early as June. The upcoming inflation report next week will be a crucial factor before the BoE makes its decision. (Bloomberg)
DOMESTIC UPDATES
- The government bond auction held on May 14, 2024, garnered total bids amounting to IDR 49.42 trillion, slightly lower than the IDR 50.20 trillion received in the previous auction on April 30, 2024. The series FR0100 attracted the highest bids, totaling IDR 17.43 trillion, with a yield range of 6.99% to 7.25%. This was followed by series FR0101 and SPN12250502, which received bids of IDR 12.44 trillion and IDR 5.10 trillion, respectively. The yield range for FR0101 was 6.94% to 7.20%, while SPN12250502 had a yield range of 6.76% to 6.96%. The amount awarded at this auction was IDR 21.36 trillion, falling short of the government’s target of IDR 22 trillion and the previous auction’s awarded amount of IDR 21.50 trillion. This resulted in a bid-to-cover ratio of 2.31x. (DJPPR)
- Indo Retail sales increased by 9.3% y-y in Mar-24, a significant upward revision from the previous estimate of 3.5%. Leading the growth was the clothing sector with a 20.6% y-y increase, followed by Spare Parts and Accessories at 17.3%, and Food, Beverages, and Tobacco at 10.4%. For April 2024, retail sales are estimated to show minimal growth, with only a 0.1% y-y increase. This pattern can be attributed to the seasonality of "Idul Fitri." Spending on clothes typically surges near Idul Fitri, peaking in April last year with a 17% y-y increase, whereas this year it peaked in Mar-24, resulting in the observed decline in April growth. This seasonality is also reflected in the monthly growth rates, where retail sales grew by 9% m-m in Mar-24, decelerating to 3.3% m-m in Apr-24. (Bank Indonesia)
To see the full version of this daily update, please click here
