CIMB Daily Fixed Income Commentary - 08 May 2014

Good Morning,

Market Roundup

• US Treasury yield curve steepened, as a result of better buying interest along the shorter ends, after market noted the dovish statement from the Fed chief Janet Yellen during midweek.
• Malaysian government bond market strengthened on the back of strong buying interest during midweek, suspecting boosted by the foreign fund inflows after seeing softer economic data. Trading volumes surged to RM4.9 billion on Wednesday. At this juncture, still seeing decent buying interest on GII Mar’21 and May’24, which drove the yields lower by 2 and 3bps lower to 4.04% and 4.20%.
• THB denominated government bonds posted decent gains along the medium and long ends of the curve, as asset managers continued to show decent buying interest, despite foreign players continued net selling on Wednesday. In GB segment, LB196A, LB236A and LB176A were pretty active throughout the day. Meanwhile, market focus was on the short dated TB14815A, which contributed a sum of trading volume worth THB7.9 billion.
• IDR denominated government bond market booked losses by around 5-15bps on Wednesday. The weakening was accompanied by hefty volume of IDR10.12 trillion from IDR4.77 trillion only in the previous day. The most transacted papers were 5-year FR69 (IDR1.43 trillion) and 15-year FR71 (IDR1.38 trillion). We noted some interest along selected off-the-run series. At the end of the day, foreign reserves data in April released, increasing to USD105.56 billion from USD102.59 billion in the previous month.
• Asian dollar credits were traded in mixed directions, amid thinner flows as market was expecting more attractive pricing from the potential pipelines, which included CNPC and Yanzhou Coal.

Best Regards,
CIMB Fixed Income Research
Corporate Banking, Treasury and Markets
Tel: +603 2261 8888 | Fax: +603 2261 8705
www.cimb.com

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