US inflation slumped again. After consumer-level inflation is inclined, producer-level inflation also becomes lower. US PPI Headline Oct. was at the level of 8.0% YoY (Vs. Sept. 8.4% YoY), in line with the normalization of gas prices that went down to 10% MoM and the price of several food commodities. Furthermore, the low CPI and PPI made the market’s speculations dominate on the increase in Dec. FFR of +50Bps (Vs. +75Bps), based on the Fed Watch CME survey. For the record, energy and food prices tend to be very volatile amid rising crude oil prices. Brent and WTI oil prices rose by 1% on a daily basis due to the disruption of the Druzhba oil pipeline.
Corporate Bonds
MDKA Bonds Offer Coupons up to 11%. Gold mining issuer PT Merdeka Copper Gold, Tbk (MDKA) plans to seek new debt through the issuance of bonds or debentures worth IDR 4 trillion, consisting of three tenors. In more detail, a 1-year tenor with an interest rate of 6.5%-7.00%; 3-year tenor with a coupon of 9.75%-10.50%; and a 5 year tenor with yields offered between 10.75%-11.00%. This bond issuance is the first phase of the Merdeka Copper Gold Sustainable Bond IV program, with the bond rating getting the idA+ label from Pefindo. (CNBC Indonesia)
Domestic Issue
Indonesia’s Trade Balance Record a Surplus of USD5.67 Billion. The Statistics Indonesia noted that the trade balance surplus in October 2022 was USD5.67 billion, an increase from USD4.99 billion in September 2022. This is in line with the export value that recorded at USD24.81 billion and the import value that recorded at USD19.14 billion. In more detail, the goods trade surplus was driven by a trade balance surplus for non-oil and gas commodities, amounting to USD66 billion. (Kontan)
Recommendation
Investors are looking forward to the results of the BI RDG. At this moment, investors are looking forward to results of the BI Nov. RDG on Thursday afternoon, it is projected to raise the BI 7DRR by +50Bps, based on a Bloomberg survey.
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