CIMB Daily Fixed Income Commentary - 02 April 2015

Good Morning,

Market Roundup

• US Treasury yield curve ended flatter, as the UST yields were dragged lower by the weaker-than-expected ADP Employment data in March. The March reading came in at 189k, below consensus estimate of 225k and also 214k garnered in prior month.
• Malaysian govvies extended gains, amid consistent buying flows. Furthermore, daily volume was heavy, amounted to RM7.4 billion, led by decent buying interest in the 7- and 10-year MGS benchmarks, along with the medium term GII papers.
• Thai government bond yields edged lower along the curve, after seeing the inflation eased for a third consecutive month in March. The March CPI showed a larger margin of decline at 0.57%, compared to the consensus estimate of 0.44%, which was dragged by the drop in transportation and energy prices.
• Indonesia government bond market posted gains following Tuesday's bond auction with yield curve went down 7-10 bps on opening, market was biddish prior to CPI data. Market turned around after March CPI rose higher to +6.38% YoY from +6.29% YoY recorded in February. Some selling action seen along the auctioned benchmark bonds FR70 (10-year) and FR68 (20-year), erased most of the gains for the day. Transaction volume increased further to IDR 15.76 trillion.
• Asian credits posted little gains during mid-week, with sentiment lifted by the better-than-expected Manufacturing PMI number in China. However, we expect market to trade in softer tone and stay quiet ahead of Good Friday holiday this week, coupled with cautious sentiment on the upcoming NFP report.