US Treasury market was closed for Veterans’ Day last Friday.

Market Roundup

• US Treasury market was closed for Veterans’ Day last Friday.
• In any case, on top of anticipated Fed hikes markets are pricing in greater inflationary pressure on promise of fiscal stimulus from the new US president, with USD gaining ground and boosting medium to longer tenor UST yields and not to mention possibility of an increase in government borrowings into the next year or so. The 10T is up 35bps to 2.1765% as we open in Asia this week.
• FX market continued to see great volatility post US election result. EUR/USD came under pressure and further declined to 1.0855. On the flipside, USD/JPY moved a tad lower to 106.65, after it trended higher from 103.00 earlier this month. DXY is now around 99.294.
• Regional currencies tumbled against the greenback. USD/THB trended higher and closed at 35.393. MYR was under heavy pressure, as USD/MYR peaked at 4.4115 on Friday, before eventually settled lower at 4.3418.
• Ringgit denominated sovereign bonds tumbled, spooked by spikes in USD/MYR ahead last weekend. Aside, WI for the 7-year GII was heard as high as 4.02/98% before quoted lower at 3.98/94% on Friday.
• Malaysia's 3Q2016 GDP expanded at faster-than-expected pace of +4.3% yoy (against +4.0% yoy forecasted earlier), led by a turnaround in net exports and inventories, which had dragged headline growth in the previous two quarters.
• Thai sovereign bonds extended losses alongside heavy selloff in global bond markets. Daily volume was heavier at Bt28.5 billion, in contrast to Bt26.0 billion a day prior. Upcoming focus will be the LB26DA auction, which comes at an indicative size of Bt16 billion.
• There was another sell-off session for IDR government bond market again, in line with USD/IDR which traded up to as high as 13550 (onshore spot). Bonds are very volatile as end investors also become risk-averse. BI and MoF tried to calm the market by having buyback auctions in all benchmark series and some short dated off-the-run series. BI cancelled the 5-year auction, causing a wave of sell-off in 3-5-year buckets. Total bonds absorbed by BI and MoF amounted to IDR5.65 trillion. Market volume leaped to IDR25.8 trillion and was dominated by bonds maturing in over 10 years (57%).