Fixed Income Daily One Pager Series — Daily Bond Lantern
Indonesian government bonds delivered a mixed performance, with the 5Y yield (FR104) declining 3.6bps to 7.14% while the 10Y yield (FR0108) rose 1.4bps to 7.22%, resulting in a steepening of the 5Y–10Y curve by 5.1bps. The INDOBeX Composite edged up 0.05% to 430.434, supported by continued demand for the front end of the curve. Market attention remained focused on escalating geopolitical tensions after the US launched fresh airstrikes on Iran following the deaths of two American service members in Jordan. Iran responded by suspending its commitment to the interim peace agreement and threatening further retaliation, raising concerns over broader regional instability and energy market disruptions. Domestically, the rupiah outperformed regional peers, strengthening 0.2% and reaching its highest level in two weeks, supported by S&P Global Ratings’ reaffirmation of Indonesia’s investment-grade sovereign rating and growing expectations of a potential Bank Indonesia rate hike. Meanwhile, the Federal Reserve’s balance sheet increased modestly to USD6.74 trillion, although liquidity conditions remain significantly tighter than during the peak of quantitative easing. In the primary market, Bank Indonesia allotted IDR17.0 trillion of SRBI from total bids of IDR37.9 trillion, with demand heavily concentrated in the 12-month tenor, where the weighted average winning yield eased to 7.644%. On the credit front, PT Trimegah Sekuritas Indonesia Tbk’s IDR100 billion Shelf-Registered Bond II Phase II Year 2025 Series A (rated idA) is scheduled to mature on October 18, 2026.