US Treasuries pared earlier losses, with yields sustained at the recent low levels, amid increased speculation that the Fed will adopt a more gradual approach in raising rates post Brexit.

Market Roundup

• US Treasuries pared earlier losses, with yields sustained at the recent low levels, amid increased speculation that the Fed will adopt a more gradual approach in raising rates post Brexit. On the other hand, short and medium dated German bund yields were well anchored at negative territory since Brexit.
• Ringgit government bonds extended gains, paring with stronger MYR against USD ahead of weekend. Short dated papers were in good demand, supported by speculation on the potential easing move by Bank Negara in the next MPC meeting in July. Elsewhere, we expect market to see thinner flows heading into Raya holiday, whilst Ringgit bonds are likely to move sideways amid consolidation after recent gains.
• Thai government bond market closed on Mid Year holiday.
• Indonesian government bond market rallied again as the tax amnesty was officially effective starting on Friday. Both locals and foreign names were seen on the bid sides for all benchmark series. Supply looks thin, and the next bond auction will only be held on 19 July. Indonesian government bond market will resume trading on 11 July after week-long Hari Raya holiday. Market volume decreased to IDR 14.24 trillion and dominated by bonds maturing in over 10 years (51%) and bonds maturing between 1 and 5 years (30%).