Global Market Update
- On August 13th, 2024, the yield on US 10-year Government Bonds decreased by 6.07 basis points to a level of 3.8428%.
- In July 2024, US annual inflation slowed to 2.9%, the lowest since March 2021, down from 3% in June. The CPI rose 0.2% from the previous month, rebounding from a 0.1% drop in June. Shelter costs drove 90% of the monthly increase.
- UK annual inflation rose to 2.2% in July 2024 from 2% in June, missing the 2.3% forecast. Housing and household services prices increased more, while gas and electricity prices fell less than before.
Sources: Bloomberg, U.S. Bureau of Labor Statistics, Office for National Statistics – UK, Trading Economics.
Domestic Market Update
- On August 14th, 2024, the yield on 10-year Indonesian government bonds continued its daily decrease, falling by 2.71 basis points to a level of 6.8056%. This resulted in a new 6-month high for the ICBI, reaching 388.1434.
- Sri Mulyani Indrawati, Indonesia’s Finance Minister, reported that by July 2024, state spending reached IDR 1,638.8 trillion, or 49.3% of the annual target, up 12.2% from last year. This includes IDR 1,170.8 trillion for central government expenses and IDR 468 trillion for regional transfers. She expects spending to increase significantly in Q3 and Q4 as payments for contracts are processed.
- PEFINDO has upgraded PT Semen Indonesia (Persero) Tbk (SMGR) to an idAAA rating with a stable outlook, from idAA+ with a positive outlook. This also applies to SMGR’s Shelf-Registration Bonds I and II. The upgrade reflects SMGR’s strong financial discipline, key role for the government, strong market position, diverse production and logistics, and conservative financial approach. The rating is limited by intense market competition.
Sources: Kementerian Keuangan Republik Indonesia, PEFINDO, Bloomberg and PHEI.
Market ProjectionWe predict the 10-year Indonesia Government Yield Curve will continue to move within range 6.7635% – 6.9001% for tomorrow. Recommendations: FR0100, FR0102, FR0097, FR0081, and FR0091.