In July 2026, the 10-year U.S. Treasury yield remained elevated at around 4.70% as resilient labor market conditions and the Federal Reserve’s hawkish stance continued to support higher yields despite moderating inflation. U.S. headline CPI eased to 3.5% YoY in June (vs. 4.2% prior), while core CPI slowed to 2.6% YoY from 2.9%, largely reflecting lower energy prices following the US-Iran ceasefire. The Federal Reserve kept the federal funds rate unchanged at 3.50%–3.75% for a fifth consecutive meeting, although three FOMC members dissented in favor of an immediate rate hike, reinforcing expectations of further policy tightening. In Indonesia, annual inflation eased to 2.88% YoY from 3.34%, while Bank Indonesia unexpectedly left the BI-Rate unchanged at 5.75% after delivering a cumulative 100 bps of tightening since May. Against this backdrop, Indonesia’s 10-year government bond yield remained broadly stable at around 7.34% by month-end. Activity in the domestic debt capital market also strengthened, with sukuk issuance rising to IDR 5.5 trillion (vs. IDR 3.9 trillion in June), bringing cumulative issuance to IDR 24.8 trillion in 7M26. Meanwhile, corporate bond issuance rebounded to IDR 19.2 trillion (vs. IDR 5.3 trillion in June), lifting year-to-date issuance to IDR 78.8 trillion.