CIMB Daily Fixed Income Commentary - 13 June 2014

Market Roundup

• US Treasury yield curve flattened post the 30-year bond auction on Thursday, as the players were seen taking opportunity and buying on dips while the yield surged during the auction week.
• Malaysian sovereign yield curve remained pretty unchanged due to the inactive market, despite trading volume improved from RM605 million to RM1.7 billion on Thursday. Surprisingly we saw buying interest on the 20-year MGS benchmark, which pressured the yield lower by 7bps to 4.48%, while most players were slightly cautious ahead of FOMC meeting next week.
• Thai sovereign yield curve was held firm at prior day levels, despite foreign players triggered net selling activities amounted to Bt4.9 billion. Aside, trading volume remained high at Bt25 billion, while LB155A and LB196A were actively transacted totalling Bt7.5 and Bt7.1 billion respectively. IRS curve edged up, in line with treasuries’ movement.
• IDR denominated government bonds moved up on Thursday. However, in general, yields changed insignificantly. Bank Indonesia decided to maintain BI rate at the same level of 7.50% as all economists had estimated before. Although there were lacking of market movers, trading volume was relatively heavy at IDR11.23 trillion, despite lower compared with previous day that had reached IDR17.13 trillion. Three series led the market, namely 13-year FR59 (IDR2.87 trillion), the benchmark series 5-year FR69 (IDR2.08 trillion) and 10-year FR70 (IDR1.81 trillion).  
• Asian dollar credit market was thinly traded in general, while newly issued PTT Exploration tightened by 18bps from offering spread of 318bps, due to the good demand.

Best Regards,
CIMB Fixed Income Research
Corporate Banking, Treasury and Markets
Tel: +603 2261 8888 | Fax: +603 2261 8705
www.cimb.com

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