FW: CIMB Fixed Income Daily - 12 Dec 2017 - Regional markets continued to see thin flows ahead of Fed meeting

 

 

US Treasuries. UST yields edged higher Monday, coming ahead of FOMC this week. Fed funds futures show 99.3% probability for a hike this week, higher than 98.3% indicated last Friday. The market shrugged off the news of an attempted terrorist attack in New York City subway which involved four injuries as well as JOLTS data at 5.996m fall in Oct. Yields were also pressure up by primary offerings - $24b and $20b sale of 3T and 10T respectively at high yield 1.932% and 2.384%.

Malaysia. MYR sovereign bond market was pretty quiet. The 7y MGS was traded within a narrow range before eventually settled at 3.92%. Overall, bond market continued to see muted trading interest heading into FOMC meeting this week, despite USD/MYR inched lower to 4.0765 on Tuesday.

Thailand. Thai market was closed on Constitution Day.

Indonesia. IndoGB posted gains on the back of buying flows initially on FR59 10y benchmark bond, and followed by 5y benchmark. However volume was thin. We think FR59 appear to be toppish at current level, though strong bids still appeared until market close. Market volume increased to IDR11.8t and was dominated by medium and long term bonds.

Asian Dollar Credits. Asian dollar credits were barely changed amid muted trading on Monday. As for primary deals, Rural Electrification guided its 3y paper at T+125bps. Shandong Hi-speed will be meeting potential investors beginning 12 Dec. Apart from that, Philippines sovereign rating was upgraded from BBB- to BBB, reflecting its strong economic growth, whilst seeing no evidence of deteriorated investor confidence due to the president's anti-drug policy.

Best Regards,
CIMB Treasury & Markets Research-Fixed Income
Tel: +603 2261 8557 | Fax: +603 2261 8705
www.cimb.com
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