Last week, the 10-year UST yield curve still recorded a decline of 3 bps. However, Indonesia’s 5-year CDS rose slightly by 1 bp, and the Rupiah weakened marginally by 0.12%. Despite the somewhat negative tone from global indicators, the 10-year SUN yield curve (GIDN10YR) still recorded a weekly decline of 16 bps. High liquidity conditions have been one of the supporting factors behind the decrease in SUN yields.

Market participants are now awaiting the results of Bank Indonesia’s Board of Governors Meeting (RDG BI), scheduled for October 21–22. Previously in September, Bank Indonesia decided to cut the BI-Rate by 25 bps to 4.75%, accompanied by a deeper cut of 50 bps in the Deposit Facility to 3.75% and a 25bps cut in the Lending Facility to 5.50%. Year-to-date, BI has lowered the policy rate by 125bp.