BI 7DRRR in line with market expectations, responded positively by strengthening the benchmark SUN yesterday. In addition to the BI 7DRRR, BI also maintains the deposit facility rate and lending facility rate, so there is inflationary pressure. Previously, BI revised up the upper limit of its annual inflation target to 4.2% (Vs. Prev. 4%). Currently, May inflation is at 3.55% YoY (2.58% MoM), better than other countries.

Corporate Bonds
PPRE Sets Bond Coupon Up To 10.5%. PT PP Presisi Tbk. (PPRE) will issue bonds worth IDR 202.98 billion consisting of two series. In the framework of the Sustainable Public Offering, PP Presisi will issue Shelf-Registered Bonds I Year 2022 with a maximum fund target of IDR 1 trillion. In phase I, PPRE will issue IDR 202.98 billion bonds. PPRE Phase I bonds consist of two series. Series A with IDR 102.27 billion principal, 9.5% interest rate and 3-year term. Series B with IDR 100.7 billion principal, 10.5% interest rate and 5-year term. (Bisnis Indonesia)

Domestic Issue
BI Holds Benchmark Interest Rate at 3.5%. Bank Indonesia (BI) still maintained the benchmark BI 7-Days Reverse Repo Rate (BI 7DRR) at 3.5% or at its lowest level, in the BI Board of Governors Meeting in June 2022. In addition to holding the benchmark interest rate, the central bank also held the deposit facility interest rate is at the level of 2.75% and the lending facility interest rate is at the level of 4.25%. This decision is in line with the need for BI to maintain the stability of the rupiah exchange rate and the inflation rate. (Kontan)

Survey: June Inflation Breaks 4%. BI’s Dovish stance maintains BI 7DRRR 3.50% amid June CPI YoY which is projected to reach 4.14% (Vs. May 3.55%), based on Bloomberg survey data. This projection touches the upper limit of BI’s annual inflation target, which is in the 2%-4.2% YoY range.

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