FW: CIMB Fixed Income Daily - 09 Oct 2017 - NFP shows a decline but UST still weakens

 

US Treasuries. UST continued to weaken amid the hurricane influenced NFP at decline of 33k in Sep, as players focused on unemployment down to 4.2%, the lowest since Feb 2001. Average hourly earnings further increased by 0.5% during the same period.

Malaysia. Malaysian sovereign bonds ended little changed Friday, awaiting US NFP for direction. The trade numbers were robust in Aug - as exports expanded +21.5% yoy, above consensus +20.0% yoy, while imports accelerated at a slightly faster pace of +22.6% yoy, compared to +21.8% yoy in Jul. Foreign reserves climbed from $100.8 billion to $101.2 billion as at 29 Sep, equivalent to 1.1 times of short term external debt and is sufficient to fund 7.6 months of retained imports.

Thailand. Yields fluctuated in narrow ranges on Friday. Demand side, BoT open market operation amounting Bt11.92 billion supported govvies within 4-14yr tenor. At the same time, front-end govvies were actively traded with contrasting interest between local and offshore players. The auction of 14-day notes drew strong demand from local investors at 3.26 bid-cover and lower average yield at 1.1625%.

Indonesia. IndoGB back in bearish tone on Friday as USD strengthened ahead of US jobs data. Market looked a bit offerish from the start. After yield curve rose 7-9 bps, support bids looked strong and were holding up until market closed. Overall market activity centered on 5- and 10-year benchmark bonds. FX volume decreased to IDR8.3 trillion and dominated by medium/ long term bonds.

Asian USD credits. Flows remained thin with China off for long holidays. iTraxx Asia ex-Japan IG index was flat on Friday. Elsewhere, S&P affirmed Saudi Arabia sovereign rating at A- with a stable outlook, citing "expectation that the country will take steps to consolidate public finances and maintain government liquid assets close to 100% of GDP over next two years."

 

 

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