CIMB Daily Fixed Income Commentary - 09 March 2015

Good Morning,

Market Roundup

·        US Treasury yields surged, after the market reacted to the upbeat February non-farm payrolls report. The February report showed a total of 295k job added during the month, way higher than 240k projected by consensus.
·        Ringgit govvies closed weaker, driven by thin selling pressure after Bank Negara Malaysia decided to keep the interest rate at 3.25%. On the flipside, the IRS ended flat on Friday, as the MPC’s result was pretty much in line with market expectation.
·        Thai sovereign yields inched lower on mild buying interest ahead of the weekend. Daily volume remained decent, increased marginally from Bt18.2 billion to Bt18.4 billion. Elsewhere, USD/THB headed lower to near 32.42 late Friday, a tad lower from the recent peak level of 32.44-32.46.
·        Indonesia government bonds continued to weaken ahead of the US NFP and unemployment data release. The market opened steady at Thursday’s closing level as the ECB said it will start QE purchases on Monday. However, some selling action was seen especially along medium-to-long tenures, causing the yield curve to steepen.
·        Asian credit spreads tightened with improved flows Friday. However, investors were noted cautiously trading well ahead of the release of US non-farm payrolls report. IG names drew decent interest and well supported. In HY segment, Country Garden Mar’20 traded 0.13pt higher at 101.23pts, while the Tower Bersama Feb’22 inched up 0.02pt to 99.79pts.