CIMB Daily Fixed Income Commentary - 10 February 2015

Good Morning,

Market Roundup

• US Treasuries extended losses, as market anticipated for incoming supplies of US Treasuries. The 10T touched the intraday-low of 1.89%, before eventually rising sharply to 1.98%.
• Malaysian government bonds closed weaker, due to the profit taking activities. On top of that, the market was muted, with daily volume stood at RM1.5 billion. Elsewhere, WI for the 7.5-year SPK was last heard at 4.15/4.05%.
• Thai government bond yields inched up along the curve, as players were trading cautiously amid a lack of fresh catalyst. Also, we think that the sovereign bond yields and IRS rates were realigning towards the arising UST yields late last week. Total transaction was low totalling Bt10.8 billion, compared to Bt20.6 billion registered on Friday.
• IDR government bond market traded down on profit taking action with YC went up 10-12 bps in morning session. Market players bought some on dips, mostly in 10yr benchmark bond, causing 10yr yield only move up 1 bps. Generally market was quiet yesterday, with IDR Syariah bond auction looming today with IDR 2 Trillion target issuance. Trading volume eased to IDR 13.2 trillion down from last week average per day of IDR 15.8 trillion.
• Mixed trading for Asian dollar credit market, post last week healthy non-farm payroll report, coupled with the unexpected substantial decline in China’s import for the month of January.