Fixed Income Daily Pulse, 9 June 2015

The day’s trade recap (from our trading desk):

·  Local govvies pared some of yesterday’s losses led by the 10-year MGS which dropped as much as 9 bps before firming back to close at 6 bps lower from yesterday’s close. 7-year MGS still looks relatively cheap on the curve even after easing back down 6 bps post yesterday 17 bps spike (7v10 spread is at 6 bps vs. historical spread of around 9-10bps). Volumes were more decent today compared to recent times as bargain hunters emerged today. Trading volume in the GG/AAA segment was lighter compare to previous day. Notable trade such as PLUS ‘01/38 remained unchanged at 4.75%, with a collective trading volume of RM20m. Meanwhile, Cagamas Berhad ‘10/28 increased 2 bps at 4.63%, with a collective trading volume of RM60m. In the AA segment, CIMB Thai Bank Public Company Limited ‘07/19 eased 8 bps at 4.82%. Elsewhere, First Resource Limited ‘10/21 increased 2 bps at 4.57%, with only RM30m changed hands. MGS Benchmark Issues MGS Closing Level (%) Chg (bp) Vol (RM m) 3-yr 3.350 -2 0 5-yr 3.390 -1 24 7-yr 4.040 -6 290 10-yr 4.100 -6 247 15-yr 4.290 -2 60 20-yr 4.370 -2 0 30-yr 4.770 -2 0 IRS Closing Rates IRS Closing Yld (%) Chg (bp) 1-yr 3.645 0.0 3-yr 3.735 -2.5 5-yr 3.980 -3.5 7-yr 4.175 -4.0 10-yr 4.440 -4.0 Source: Bloomberg, AmBank

               

  

Local News:

·             None.