Fixed Income Daily One Pager Series — Daily Bond Lantern
Indonesian government bonds weakened, with the 5Y yield (FR104) rising 6.4bps to 7.20% and the 10Y yield (FR0108) climbing 5.1bps to 7.27%, resulting in a flattening of the 5Y–10Y curve by 1.4bps, while the INDOBeX Composite slipped 0.07%. Market sentiment remained pressured by escalating geopolitical tensions as the US conducted a ninth consecutive day of airstrikes on Iran, targeting military and communications infrastructure in an effort to reopen the Strait of Hormuz. Iran continued retaliatory strikes against US military assets across the Gulf, leaving the ceasefire effectively collapsed and keeping concerns over global energy supply elevated. Domestically, Indonesia’s parliamentary panel approved key provisions of the International Financial Centers Bill, which proposes tax holidays of up to 50 years, exemptions on foreign-sourced income and selected VAT, and a dedicated regulatory framework to attract an estimated IDR300–500 trillion in investment, with a final parliamentary vote scheduled for July 21. Meanwhile, the government will auction IDR32.0 trillion of SUN on July 21, offering three SPN series and reopening six benchmark fixed-rate bonds across the curve. On the credit front, PT Adira Dinamika Multi Finance Tbk fully repaid its IDR724.6 billion bond and IDR206.0 billion sukuk at maturity, while Fitch assigned an AA+(idn) National Long-Term Rating to PT Tower Bersama Infrastructure Tbk’s proposed IDR1.5 trillion bond and sukuk issuances, in line with the company’s existing rating.