Market
Roundup
- Short dated US Treasury yields climbed, reacting to the higher-than-expected inflation data released on Friday. The Jan inflation rose by 1.4% yoy, above consensus estimate of +1.3%. However, the longer dated papers saw decent support, guided by pullback in crude oil prices from recent rally. Brent is about $33.06 per barrel this morning versus last week’s high of $35.73.
- Ringgit sovereign bond posted losses in conjunction with lower oil prices and weaker Ringgit heading into the weekend. However, trading volume shrank from RM3.7 billion to RM1.9 billion on Friday.
- Thai government bonds continued to move sideways, amid muted trading interest. Daily volume further declined from Bt16.5 billion to Bt13.6 billion on Friday.
- IDR government bonds opened a bit firmer with wide bid/offer spread. We felt market turned cautious ahead BI MPC meeting on Thursday as market stuck in the opening range level. We saw heavy trading in short end tenor (1 to 2-year) and sporadic buying in selective series particularly FR56 and FR73. BI cut rate by 25bps to 7%, and lowered deposit facility and lending facility to 5% and 7.5% respectively, while slashing Primary Reserve Requirement by 1% to 6.5%, quite aggressive in latest easing measure in our view. Surprisingly, bond rally post rate cut is not happening, yet FX swap go lower and spot USD/IDR creeping higher. Market volume dropped to IDR10.8 trillion.
· Asian
dollar credits moved sideways amid thin trading interest, while oil and gas
related names were quoted a tad wider, after crude oil prices eased from recent
bullish movement.
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