US Treasuries reversed gains posted a day prior, weighed by profit taking activities ahead of the long weekend, as market will be closed be on Martin Luther King Jr Day on Monday. Treasuries also were pressured amid release of decent macro data. Wholesale prices climbed by 0.3% in Dec, pretty much in line with market expect

Market Roundup

• US Treasuries reversed gains posted a day prior, weighed by profit taking activities ahead of the long weekend, as market will be closed be on Martin Luther King Jr Day on Monday. Treasuries also were pressured amid release of decent macro data. Wholesale prices climbed by 0.3% in Dec, pretty much in line with market expectation. Meantime, retail sales expanded by 0.6% mom during the same month, decent but slightly disappointing in contrast to consensus of +0.7%.
• In the coming week, we await more data including CPI and industrial production as well as latest Fed Beige Book report. We also face more Fed-speak including from Janet Yellen. Political risks remain heightened as we await the new President taking office 20 Jan.
• USD strength further eased after US president-elect Trump provided little clues on his fiscal policies during his news conference last week. USD/JPY consolidated and closed at 114.54, after hitting the fresh lows below 114.00 for the first time this year. Elsewhere, EUR/USD also edged higher to 1.0643 amid weaker USD.
• Ringgit sovereign yield curve steepened on Friday, with players tapping on shorter dated papers. Meantime, daily trading volume was decent at RM2.8 billion, despite lower than RM4.9 billion registered on Thursday. Highlight in the coming week include Dec 2016 inflation data and MPC meeting scheduled on 18-19 Jan. The Dec CPI is expected to record at +1.7% yoy or a tad lower than 1.8% yoy in Nov. Meanwhile, the market mostly anticipates policymakers to maintain the OPR at 3.00% during the MPC meeting.
• THB denominated government bonds weakened a tad ahead, weighed by profit taking activities after recent gains. Secondary trading also saw thinner flows totaling Bt11.8 billion, compared to Bt21.4 billion garnered a day prior. Upcoming primary supply will be LB226A auction slated for 18 Jan, with an indicative issue size of Bt25 billion.
• Indonesian government bond market was traded down in price on Friday as market players took profit ahead of this week's bond auction. Bids were supportive though, buyers were still seen especially on 7-year FR70 bonds and 20-year benchmark series. In terms of activity, market looked relatively quiet compared to Thursday. Volume increased to IDR16 trillion and mostly concentrated on bonds maturing in over 10 years (74%).