Longer dated US Treasuries were dealt firmer with release of weaker-than-expected consumer confidence numbers though overall the market was moving sideways intraday by as much as +/-5bps as players await more data. The US consumer confidence index registered a reading of 98.6 for the month of Oct, down from a downward revised 103

Market Roundup

• Longer dated US Treasuries were dealt firmer with release of weaker-than-expected consumer confidence numbers though overall the market was moving sideways intraday by as much as +/-5bps as players await more data. The US consumer confidence index registered a reading of 98.6 for the month of Oct, down from a downward revised 103.5 in Sep (against 104.1 prior estimate) and earlier consensus of 101.5. The Case-Shiller 20-city Index rose 5.1% yoy in Aug against +5.0% consensus and +4.98% yoy the month before. Upcoming data this week include retail sales, home sales and durable goods orders.
• The US Dollar weakened after recent gains with release of weaker-than-anticipated US consumer confidence numbers for the month of Oct, but only after rallying earlier in the session against the Euro with increased speculation for a Dec FOMC rate hike. But later supporting the Euro was Germany's Ifo Business Climate index unexpectedly rising to a reading of 110.5 in Oct from 109.5 in Sep. The Oct reading is a new 2-1/2 year high.
• Malaysian govvies continued to see support, with underlying strength provided by speculations of further easing by the central bank later this year. But on Tuesday there was release by Fitch which should add further interest in MYR bonds in the short to medium term period. Fitch said the new 2017 Malaysian Budget pointed to further stability in public finances, adding its view that the 3.0% to GDP fiscal deficit target for 2017 is achievable. It also said the federal government’s debt to GDP ratio should remain below the 55% to GDP limit this year. Aside, expect details today for the 20-year GII auction.
• Thai govvies were dealt rangebound with THB steady and strong support from foreign players who reportedly were net buyers of a large Bt8.24 billion of Baht-denominated bonds on Tuesday. Despite the firm movement, government papers with maturity 7-10 years lost some footing. Further market drivers for this week remain on hand, including release of Sep custom exports numbers and auction of 5.9-year LB226A (though sentiment may be dragged down seeing large offering size of Bt30.0 billion).
• IDR government bonds were dealt firmer on Tuesday, especially in the morning session on the back of offshore net buying interests especially on 2-5 year tenors. Incoming bids for Tuesday’s auction was on the weaker side (at IDR15.3 trillion) and was mostly concentrated on the 10-year FR59. The government accepted IDR11.62 trillion in incoming bids.