Fixed InSight<\/p>\n\n\n\n
Today\u2019s highlights:<\/strong><\/p>\n\n\n\n A more hawkish Fed under Chair Kevin Warsh emerged as the key risk to the emerging market bond rally, with Goldman Sachs and Citigroup warning that a stronger USD and higher UST yields could tighten global financial conditions and limit room for EM central banks to ease \u2014 even as lower oil prices from the US-Iran deal continued to support inflation relief. On the geopolitical front, the US and Iran agreed to halt military attacks ahead of renewed technical talks in Doha on implementing the interim peace agreement, though key disputes over Hormuz transit fees, Iran’s role in managing the strait, and the Israel-Lebanon ceasefire remained unresolved.<\/em><\/p>\n\n\n\n From the bond market, FR 56, 37, 90, and 59 are currently the cheapest based on our yield curve model. Last national business day, the dollar index was closed at 101.36 (-0.1%). Rupiah was appreciated by 0.0% at USDIDR at 17,918. The 10yr UST yield decreased by -2.4bps to 4.37% and 10yr INDOGBR decreased by -2.5bps to 7.16% \u2013 the spread between the two was at 279bps.<\/em><\/p>\n\n\n\n Economy: A more hawkish Fed emerged as the main risk to the emerging-market bond rally despite easing geopolitical tensions.<\/strong><\/p>\n\n\n\n The rally in emerging-market local currency bonds lost momentum after Fed Chair Kevin Warsh adopted a more hawkish policy stance, shifting investor focus from easing oil prices to the prospect of higher US interest rates. Wall Street banks including Goldman Sachs and Citigroup argued that a stronger USD and higher UST yields could tighten global financial conditions, limiting room for emerging-market central banks to ease monetary policy, particularly in countries reliant on foreign capital inflows. Although the US-Iran peace agreement continued supporting lower energy prices and easing inflation pressures, investors expected Fed policy and the durability of the ceasefire to remain the key drivers of emerging-market bond performance. Source: Bloomberg<\/em><\/p>\n\n\n\n Economy: US and Iran agreed to halt military attacks ahead of renewed peace talks, although key disputes over the Strait of Hormuz remained unresolved<\/strong><\/p>\n\n\n\n US and Iran agreed to stop attacking each other before technical talks resumed this week in Doha to discuss the implementation of the interim peace agreement, following several days of retaliatory strikes triggered by attacks on commercial vessels in the Strait of Hormuz. The agreement supported freer maritime traffic through the strategic waterway, although both sides continued to disagree over issues including potential transit fees, Iran’s role in managing the strait, and the ceasefire between Israel and Lebanon. Despite the de-escalation, both Washington and Tehran warned they would respond militarily to further violations, highlighting that geopolitical risks remained elevated. Source: Bloomberg<\/em><\/p>\n\n\n\n Fixed Income: Pefindo assigned idAA rating to KA Logistik driven by strong likelihood of support from parent KAI<\/strong><\/p>\n\n\n\n Pefindo assigned its idAA general obligation rating with stable outlook to PT Kereta Api Logistik (KA Logistik), valid through 1 Jun’27. The rating was anchored by the strong likelihood of support from its parent PT Kereta Api Indonesia (Persero) (KAI, idAAA\/Stable), strong competitive position in rail-based logistics, and strong financial profile, while tight competition, limited pricing flexibility, and project execution risks remained the primary constraints. An upgrade could materialize if KA Logistik successfully executes its strategic plan resulting in higher-than-expected revenue and EBITDA on a sustained basis, while a downgrade could be triggered by significantly higher-than-projected debt without compensating EBITDA growth, or adverse change in degree of importance toward KAI. KA Logistik conducts rail-based logistics transporting coal, cement, and general cargo in Java and South Sumatra, 99.3% owned by KAI as of 31 Mar’26. Source: Pefindo<\/em><\/p>\n\n\n\n Fixed Income: PNM’s upcoming debt maturities totaling IDR1.39tn to be repaid using internal funds<\/strong><\/p>\n\n\n\n PT Permodalan Nasional Madani (PNM) announced three debt instruments maturing in the near term: Sukuk Mudharabah Medium Term VII Year 2025 Phase I (rated idAAA\/sy) amounting to IDR180bn due 27 Jun’26, Shelf Registered Social Orange Bond I Phase I Year 2025 Series A (rated idAAA) amounting to IDR220bn due 18 Jul’26, and Shelf Registered Sukuk Mudharabah Social I Phase I Year 2025 Series A (rated idAAA\/sy) amounting to IDR990bn due 18 Jul’26. The Company plans to repay all instruments using internal funds, supported by cash and cash equivalents of approximately IDR3.3tn as of end-Apr’26. Source: Pefindo<\/em><\/p>\n\n\n\n Fixed Income: Pefindo assigned idBBB+ to SOCI and idAAA\/sf\/sy to its proposed Sukuk I Year 2026 of maximum IDR3tn enhanced by SMI<\/strong><\/p>\n\n\n\n Pefindo assigned idBBB+ general obligation rating with stable outlook to PT Soechi Lines Tbk (SOCI) and idAAA\/sf\/sy to its proposed Sukuk I Year 2026 of maximum IDR3tn, valid through 1 Feb’27, with proceeds to be used for refinancing existing bank loans and capex. The Sukuk rating reflects a very strong credit structure supported by a subordinated credit facility of maximum IDR3tn from PT Sarana Multi Infrastruktur (Persero) (SMI, idAAA\/Stable) as credit enhancement and Sukuk sinking funds, while the corporate rating was anchored by SOCI’s strong market position in the tanker shipping segment, integrated shipping operations, and strong financial flexibility, constrained by limited ability to expand margins and high leverage. A corporate rating downgrade could be triggered by inability to renew expiring contracts, significantly lower charter rates during contract renewal, or higher-than-expected debt without compensating earnings visibility. The Sukuk instrument rating may be lowered if SMI’s rating is downgraded or if SOCI utilizes the non-revolving credit enhancement facility more than expected. SOCI is a shipping holding company established in 2010, offering transportation, maintenance, repair, shipbuilding, and dry-docking services, with PT Darma Pertiwi Raya and PT Pilar Sukses Utama each holding 35.05% as of 31 Mar’26. Source: Pefindo<\/em><\/p>\n\n\n\n