CIMB Daily Fixed Income Commentary - 15 April 2015

Good Morning,

Market Roundup

• US Treasuries extended gains, guided by weaker-than-expected retail sales in March, despite it rebounded from a three-consecutive-months decline since December last year. The March reading came in a tad lower at 0.9% growth, against 1.1% expansion estimated earlier.
• Ringgit govvies ended weaker, as sentiment dented by the World Bank’s lower growth projection for 2015, pairing with weak MYR, and further dragged by a relatively weak auction result for the new 5-year MGS benchmark.
• Market closed on Songkran Festival Day.
• Indonesia government bond yield curve went up by 9-12bps post bond auction as demand in the auction was underwhelming, receiving IDR10 trillion of bids. Hence, government downsized the issuance, and only issued IDR8.66 trillion from an earlier target of IDR10 trillion. Players were seen selling auctioned bond especially FR71 (15yr), however market provides strong support around 10-year 7.40% and 15-year 7.55% levels. Trading volume eased to IDR12.5 trillion.
• Asian dollar credits ended marginally wider, amid heavy flows from the primary market on Tuesday. Investors were seen offloading some positions in the secondary market, to make room for the new issues. On the other hand, Grand China Air Apr’17 dealt firmer at 5.07%, tightened from 5.13% a day ago.