US GDP data for 4Q22 came in at 2.9%, higher than the 2.6% forecast but indeed lower than 3.2% in 3Q22. This sign of economic slowdown started to emerge due to the Federal Reserve’s aggressive pace of interest rate hikes, as well as the weakening demand in the housing market as reflected in Building Permits, which contracted to 1.337 million, lower than the previous 1.351 million. The weakening demand was also seen from the New Home Sales (Dec.), which fell to 616K, lower than the forecast of 617K, although more robust than the previous month at 602 K. As for the labor market remains tight despite the massive wave of layoffs at several technology giants, with Initial Jobless Claims still at 186K, coming in lower than the 205K expected for last week and below the previous period of 192K. Those several results have made investors expect increasingly dovish future rate hikes, though The Fed has emphasized that the 5% FFR is non-negotiable to suppress US inflation further. Meanwhile, foreigners are seen hunting for Government Securities (SBN) amid rising yields. Based on data from the Directorate General of Financing and Risk Management (DJPPR) of the Indonesian Ministry of Finance, from January 2 to January 24, 2023, foreign investors still recorded a net buy or inflow of IDR 42.1 trillion. As for this week, foreigners recorded an inflow of IDR 30.3 trillion. Meanwhile, from the auction market, the State Sharia Securities (SBSN) auction that was held last Tuesday, foreign bids reached IDR 7.6 trillion. This amount doubled compared to the previous auction on January 10 of IDR 3.38 trillion.

Corporate News
PT Chandra Asri Petrochemical Tbk (TPIA) Sells Bonds with 9.5% Interest Rate. PT Chandra Asri Petrochemical Tbk (TPIA) will raise funds through the issuance of bonds worth IDR1.25 trillion with three tenors. The tenors are five years with an interest rate offer of 8.00-8.50% per year, seven-year maturity with a coupon of 8.50-9.00% per year, and ten years with a yield offered between 9.00-9.50% per year. Those bonds shall be paid every three months. (CNBC Indonesia)

Domestic Issue
The government issued special bonds for the Voluntary Disclosure Program (PPS) or tax amnesty program volume II for 2023. This year’s first bonds will be issued later this month. If no issues are encountered, the government will issue the state securities (SBN) for five times up to September 2023. The issuance schedule is carried out alternately between government bonds (SUN) and state sharia securities (SBSN). (KONTAN/Business Insight)

ID10YT yield continued to rise after successfully breaking out MA10 at 6.7, thus potentially heading towards the next Resistance at MA20 / 6.83, up to MA50 around 6.89; thus starting to try to break the downtrend in yield from last November. ADVISE: Average Up accordingly. The same bullish reversal pattern is also happening on the US10YT yield, where it is estimated to form an Inverted Head & Shoulders pattern with a crucial Neckline at 3.55 (all MA20 break); thus opening the way to TARGET 3.72-3.77. ADVISE: Buy on Break after breaking the Neckline; Average Up above MA50/3.6.

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