US inflation data fell for the first time since May 2020, bolstering optimism that the Federal Reserve will downshift to a smaller rate hike at next month’s FOMC Meeting, which is at 0.25% (probability 92%). The CPI fell by 0.1% in December 2022, contrasting with economists’ forecast of no change. This deflation decreased the annual CPI to 6.5% YoY from 7.1% in November. Core inflation (which excludes volatile food & energy prices) still rose 0.3%, as expected. Initial Jobless Claims came at 205K, still below the forecast of 215K and the previous period of 206K, proving that the market labour is still tight. Treasury yields are under pressure as the Fed seems to take a pause first, while the 10- year Treasury yield fell below 3.5%.
Sandiaga Uno’s Issuer Releases IDR 1.5 T Bonds. An issuer in the telecommunications infrastructure service industry, PT Tower Bersama Infrastructure is seeking new funding through its subsidiary. The company is seeking new funding through the issuance of bonds or debt securities worth IDR1.5 trillion, which is one of the company’s Sustainable Bonds V programs. This time, the bonds of issuers affiliated with Sandiaga Uno’s Saratoga Group only offer a short-term tenor which is a one year coupon or interest for investors in the range of 5.75%-6.75% per year. (CNBC Indonesia)
The rupiah to US dollar exchange rate strengthened to 15,338 along with the existing sentiment from falling US CPI and rising inflation in China. Meanwhile, investors turned slightly bullish on the Indonesian rupiah for the first time since April last year, although the long-term bets on the currency were the least among currencies that were part of a Reuters poll. Moreover, the Asian currency positioning poll is focused on what analysts and fund managers stated that the current market positions in nine Asian emerging market currenThe rupiah to US dollar exchange rate strengthened to 15,338, along with the existing sentiment from falling US CPI and rising inflation in China. Meanwhile, investors turned slightly bullish on the Indonesian rupiah for the first time since April last year, although the long-term bets on the currency were the least among currencies that were part of a Reuters poll.
US10YT is hanging on to the lower channel Support of its long-term uptrend, right at 3.45. Technical rebound anticipation happens to keep this uptrend intact towards the resistance/TARGET, a stack of Moving Averages in the range of 3.58-3.68; if the range can be broken through, it will free the yield to move forwards to 3.8 or even the previous high of 3.9. Equivalently, ID10YT yield is also almost at the bottom target, according to the Rising Wedge pattern around 6.715, while RSI begins to show positive divergence. The same thing we advise is to anticipate a technical rebound towards the first resistance: the intersection of MA10 & MA20 at yield 6.91, before catching up to MA50/6.98 up to 7.0 psychological level.
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