CIMB Daily Fixed Income Commentary - 05 Jun 2015

Market Roundup

• US Treasuries pared losses, with buying-on-dips interest came into support after the quick sell-off event over the last two sessions. In addition, stock markets decline and Greek debt crisis concerns also drove some flows to the safe-haven assets and weighed the yields lower. The Greek government decided to delay Friday’s IMF loan repayment bundled it with the remaining three due this month, which sum up to be $1.7 billion to be paid by end of June.
• Ringgit government bonds were under pressure on Thursday, driven by sell-off event in US Treasuries. However, short term bonds were well demanded, as players shortened portfolio duration amid the rise in yields.
• Thai govvies closed weaker, amid bearish sentiment triggered by heavy selling pressure in overnight UST. The sovereign yield curve steepened, as players were seen selling particularly across the far end of the curve. Despite that, local players showed better bidding interest and absorbed in the market. Aside, daily volume moderated from Bt44.8 billion to Bt25.8 billion.
• Indonesia government bond market sell-off aligned with global debt market on Euro inflation worry. Foreign banks led selling action especially on belly to long end of the curve, with shorter end tenures trekking the yield curve movement. Defensive bids appeared at current level, providing support, while BI was seen checking prices in the market. Trading volume improved to IDR 10.7 trillion.
• Asian credits closed mixed amid jitters following the sell-off in UST and German bunds a day ago. However, newly issued names were seen well supported and tightened marginally in secondary trading.