CIMB Daily Fixed Income Commentary - 05 November 2014

Market Roundup

• US Treasury yields inched lower along the far end of the curve, supported by some buying-on-dips activities. Sentiment remained cautious ahead of key events this week – ECB meeting and nonfarm payroll report.
• Malaysian government bonds posted little gains on Tuesday, amid positive buying interest. GII May’24 was again in the limelight, dipped another 1bp to close at 4.10%, still decent with a spread of 28bps against MGS Jul’24.
• Thai sovereign yields fell along the curve, amid positive buying sentiment. Long dated bonds strengthened decently, with yields dropped by 4-9bps, as players continued to place their bets on the possibility of interest rate cut on Wednesday’s MPC meeting.
• Indonesia Issued IDR 6.9 trillion on bond auction yesterday. Incoming bid was IDR 22 trillion. Bond prices had gone up shortly after auction result. But prices went back down near Monday closing on profit taking action.
• Dollar credits hovered near prior levels, amid a lack of fresh market catalyst at this juncture. Credit spreads tightened marginally along the front end of the curve, guided by higher UST yields. Still see better bidding interest along the fresh primary deals.