On Friday, global indicators once again pointed to negative sentiment. The 5-year U.S. Treasury (UST) yield curve rose by 14 basis points (bp) to 4.13%, and the 10-year UST yield curve increased by 11 bp to 4.51%. Bloomberg data also showed that the Rupiah weakened slightly by 0.01% to Rp16,285/US$. However, Indonesia’s 5-year Credit Default Swap (CDS) declined slightly by 1 bp to 77 bp.
On a week-over-week basis, the 10-year UST yield curve rose by 10 bp. Meanwhile, Indonesia’s 5-year CDS recorded a weekly decline of 2 bp and the Rupiah strengthened by 0.26% against the US$. Despite the mixed market sentiment, the 10-year Government Debt Securities (SUN) yield curve (GIDN10YR) fell by 7 bp from the previous week’s level.
By Monday, June 9, global indicators shifted to a more positive sentiment, reflected in the decline of UST yields and Indonesia’s CDS. The 5-year UST yield curve fell by 4 bp to 4.09%, and the 10-year UST yield curve dropped by 2 bp to 4.49%. Bloomberg data showed that the Rupiah slightly weakened against the US$ by 0.04% compared to last Friday’s level, reaching Rp16,291/US$. Meanwhile, Indonesia’s 5-year CDS fell by 2 bp to 75 bp. The continued decline in CDS levels reflects investor confidence in Indonesia’s creditworthiness, despite the volatile global environment.
Following the market holidays on Friday and Monday, the domestic market is expected to reprice in response to the changes in global conditions. Considering the above market conditions, we see the potential for steady demand for Rupiah-denominated Government Securities (SBN). We estimate the weekly range for the 10-year SUN yield during the period of June 9–13 to be around 6.70%–6.83%. Based on the yield curve valuation, the following bonds are expected to be attractive to investors: FR0094, FR0064, FR0099, FR0052, FR0045, and FR0106.
Kindly find the link to our Fixed Income Daily Market View for June 10, 2025 provided below this message. Thank you and best regards!
IND
https://research.bnisekuritas.co.id/doc-view?z=f23e1b98-08b9-4ab5-afb2-3cb39a0b02c2
ENG
https://research.bnisekuritas.co.id/doc-view?z=ae667f85-4df8-4fd7-a8f3-40e63bf0550c
