The SUN market strengthened, amid the potentially sloping October inflation rate, or projected at only 0.09% MoM, in line with the normalization of prices for a number of food commodities. NHKSI Research sees the impact of the significant increase in subsidized fuel prices of up to 30%, which has been fully reflected in the inflation rate in September which reached 1.17% MoM.
Corporate Bonds
BSDE: Records a Declining of Apartment Demand in 3Q22. PT Bumi Serpong Damai Tbk (BSDE) stated that the record of apartment demand up to September 2022 was still quite good, even though the demand was facing a decline compared to the same period last year. The declining apartment demand has decreased by 5% to 7% compared to the previous year. The company explained that the existing supply is plenty while the demand is stagnant. (Kontan)
Domestic Issue
Ministry of Finance: 3Q22 GDP Projection Grows 5.7%. The Ministry of Finance projects growth in 3Q22 by 5.7% or higher than the realization of 5.4%. The economic growth was supported by a surge in prices of Indonesia’s leading commodities, such as coal, palm oil, and nickel. The increase in global commodity prices has made the state budget and trade balance becomes surplus since the beginning of the year. (CNN Indonesia)
Recommendation
Fluctuations in medium-term crude oil prices will be influenced by US sentiment, which escapes the Recession, OPEC+ production cuts in early November to a ban on Russian oil purchases in early December. During the last week, both WTI and Brent crude oil recorded price increases of around 3% WoW. US GDP 3Q22 QoQ expanded +2.6% (Vs. contractions -0.6% in 2Q22 and -1.6% in 1Q22), which affected the economy to grow an increase in oil demand, making crude oil sentiment dominate the energy sector. On the other hand, improving coal supply and the growth of the NRE generator, which weakens the coal demand, pushed the price of ICE Newscastle down by more than 1% WoW.
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