Positive economic data sentiment supported bids for SUN auctions. DJPPR data shows bids for SUN auctions reached IDR 36.9 trillion, higher than the previous SUN auction of IDR 29.5 trillion. In addition to relatively subdued domestic inflation, investors also responded positively to the results of the FOMC meeting in July, which met expectations. Market participants also see that the Fed will potentially not be as aggressive as before in setting the next interest rate policy.

Corporate Bonds
KAI Offers IDR 2 Trillion Bonds and Sukuk. PT Kereta Api Indonesia (Persero) will offer bonds and sukuk with a total value of IDR 2 trillion. The funds raised from the offering of bonds and sukuk will be used to pay off the principal debt and finance a number of project developments. The bonds have earned a double A plus or AA + rating from PT Pemeringkat Efek Indonesia (Pefindo). PT KAI will conduct a Continuous Public Offering of Sustainable Bonds I by issuing sustainable bonds I KAI Phase I 2022 amounting to IDR 1.5 trillion from the target of IDR 2.2 trillion. This bond issuance coincides with the issuance of the 2022 Sustainable Sukuk Ijarah Phase I of IDR 500 billion from the target of IDR 800 billion. (Bisnis Indonesia)

Domestic Issue
Government Optimistic Economic Growth in 2023 Reaches 5.9%. The global economy still faces various challenges and uncertainties. Global inflationary pressures continued to increase in line with high commodity prices due to continued supply chain disruptions. However, the Coordinating Minister for Economic Affairs is optimistic that Indonesia’s economic growth next year will be in the range of 5.3% to 5.9%. Furthermore, the optimism for increasing economic growth opportunities is the handling of the Covid-19 pandemic, which is currently considered better than other countries. (Kontan)

Market participants look forward to the release of 2Q22 GDP data. Core CPI is maintained below 3%, leaving room for BI to maintain BI 7DRRR at 3.50%, as Core CPI is still within BI’s target of 2%-4%. Meanwhile, Indonesia’s 2Q22 GDP is projected to grow 5.20% YoY (Vs. 1Q22 5.01% YoY). On the other hand, the strengthening of the Greenback put pressure on the Rupiah, which had depreciated near the level of IDR14,900/USD, before finally closing down 0.1% on a daily basis.

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