US Treasuries. US Treasuries were dealt firmer ahead of risk events this week namely FOMC meeting, US jobs data release, and possible Fed chair nomination. In economic data releases, personal income and spending grew by +0.4% and +1.0% in Sep, pretty much in line with expectation at +0.4% and +0.9% mom. Meantime, PCE core was flat at +1.3% yoy in Sep against 1.3% consensus expectation.
Malaysia. MGS saw net buying interest mostly along the shorter to medium tenors. Volume was light and net buying interest was not extended in view of incoming external drivers in the coming week. All in, we think most of the net buying bargain hunting interest.
Thailand. Yields fluctuated in a tight lower range along the bellies of curve, in line with UST market. The market was traded in light activity as players waited key macro and events. Thailand's current account balance in September is due today and we expect a good (surplus) number amid upbeat Thai custom exports and trade balance. That said, a firm number may somewhat increase demand for Thai bonds after the foreign sell-off since middle of October.
Indonesia. IndoGB market was quiet and rangebound for most of the day before gradually weakening ahead of Tuesday's bond auction. Bonds seeing heavy flow were in 5-10y tenors, with some bargain hunting seen there and 20yr bucket also. MoF will be holding IDR bond auction with IDR15 trillion target, auctioning 5y, 10y and 15y benchmark bonds and 3m & 9m SPN bills. Demand could be moderate-to-solid, although players may try to bid at yields higher than the current market.
Asian USD credits. Dollar credits in Asia saw weaker movement on Monday, following profit taking pressure on the new China sovereign bonds. The new China 22s and 27s were about 2bps wider. However, their respective spreads remain tight against last week's pricing of 15bps and 25bps over UST. The iTraxx Asia ex-Japan IG index was half a basis point wider Monday.
Best Regards,
CIMB Treasury & Markets Research-Fixed Income
Tel: +603 2261 8557 | Fax: +603 2261 8705
www.cimb.com
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