Government Bonds
The yield of Government Bonds (SUN) was relatively lower at the weekend, amid pressure from the Composite Stock Price Index (JCI) and the decline in UST yields. The 10-year SUN yield closed at 6.30%. The high number of cases due to Covid-19 in Indonesia has forced BI to revise economic growth down to 3.8% in 2021. This projection is lower than the previous projection in the range of 4.1% – 5.1%. Meanwhile, US Gross Domestic Product (GDP) data grew 6.5% in 2Q21, lower than market expectations of 8.4%.

Corporate Bonds
Waskita Karya Bonds Earn idBBB Rating. The Indonesian Securities Rating Agency (Pefindo) has affirmed its idBBB rating for Waskita Karya (Persero)’s 2016 PUB II Bonds (WSKT) worth IDR 900 billion. The same rating was also given to PUB Bonds III 2018 Phase III Series A worth IDR 761 billion, both of which will mature on September 28, 2021. Waskita Karya will fully repay the maturing bonds using proceeds from the corporate action plan. (Kontan)

Greater Investment in Manufacturing Sector. To pursue the government’s target of becoming a developed country in 2045, Indonesia needs to pursue investment with a larger share in the manufacturing industry or manufacturing sector. Based on data from the Ministry of Investment, the realization of service sector investment during the first semester of 2021 was IDR 218.7 trillion, equivalent to 49.4% of the total direct investment in the period January 2021 to June 2021, which was valued at IDR 442.8 trillion. This achievement has become a trend in the service sector from 2017 to 2020. (Kontan)

Low Inflation Keep Rupiah. NHKSI Research projects inflation in July to remain low, or around 0.01%. This low inflation is a positive sentiment for the movement of the rupiah, as well as making the bond market better. Externally, the US dovish policy sentiment will also benefit the rupiah. Market participants are also looking forward to the release of US non-farm payroll and employment data. Next Tuesday, the government will again offer FR0090, FR0091, FR0088, FR0092, and FR0089 in the planned SUN auction. On the other hand, the FR0086, FR0087, and FR0083 are no longer offered, making these three series lack supply in the secondary market.