Fixed Income Daily One Pager Series — Daily Bond Lantern
Indonesian government bonds weakened, with the 5Y yield (FR104) rising 2.7bps to 7.11% and the 10Y yield (FR0108) climbing 5.3bps to 7.17%, resulting in a steepening of the 5Y–10Y curve by 2.6bps, while the INDOBeX Composite slipped 0.08%. Despite the softer bond performance, Indonesia’s macroeconomic fundamentals remained resilient, with state revenue reaching IDR1,459.4 trillion (46.3% of the 2026 budget target) in 1H26, up 21.4% YoY, keeping the budget deficit contained at just 0.76% of GDP and the primary balance in surplus. Meanwhile, foreign exchange reserves edged up to USD145.6 billion in June, supported by tax and services receipts that offset external debt repayments and Bank Indonesia’s rupiah stabilization efforts. The government’s latest SUN auction also underscored healthy investor demand, raising IDR32 trillion in line with its target from IDR55.09 trillion in bids, with strong interest concentrated in the benchmark FR0109 and FR0108 series. In the US, the trade deficit widened sharply to USD77.6 billion in May as imports rebounded while exports weakened, highlighting softer external demand. On the credit front, PEFINDO assigned idAA ratings to PT Dian Swastatika Sentosa Tbk’s proposed bond and sukuk programmes and idA+ ratings to PT Pindo Deli Pulp and Paper Mills’ proposed bond and sukuk programmes, while affirming Stable Outlooks for both issuers.