Trade Surplus Press Yield, Ahead of the End of Year Auction. The Central Statistics Agency recorded Indonesia’s exports worth USD 14.39 billion, with imports of USD 10.78 billion. This caused the trade balance to record a surplus of USD 3.61 billion. Compared to the October 2019 period, exports fell 3.29% YoY while imports fell 26.93% YoY. This sentiment attracted investors to short tenors, with FR0081 posting the deepest yield decline. Yield FR0081 fell by more than 8 bps to 5.24%, followed by FR0080 down 5.6 bps to 6.75%. For the record, the government is offering as many as seven series in the SUN auction this Tuesday. Two short tenor Government Securities (SUN), namely: SPN03210218 (New Issuance) with 3-month tenor; SPN12210812 (Reopening) 9-month tenor. And five series of fixed rates, namely: FR0086; FR0087; FR0080; FR0083; and FR0076. For the record, this SUN auction is the second-last SUN auction in 2020.

Barito Pacific Issued Coupon Bonds of 10.25%. Barito Pacific Tbk (BRPT) will issue Sustainable Bonds I Barito Pacific Phase III Year 2020 with a maximum principal amount of IDR 386.25 billion. The bonds will be guaranteed with full commitment, offering three series. Series A worth IDR 167.52 billion with a coupon of 8.25% with a 370-day tenor, Series B worth IDR 56 billion with a 9.25% coupon for 3-years, and Series C worth IDR 163 billion with a 10.25% tenor coupon. 5 years. Meanwhile, these bonds are part of the Sustainable Public Offering (PUB) through the 2019 Barito Pacific Sustainable Bonds I with a target fund raised of IDR 1.5 trillion. All proceeds from the offer are to repay part of the company’s debt of USD 200 million based on a Facility Agreement related to USD 200 million Single Currency Term Facility on 19 December 2019. (Bisnis Indonesia)

Indonesia’s External Debt Ratio Increases to 38.1% of GDP. Bank Indonesia (BI) recorded that Indonesia’s foreign debt in 3Q20 was USD 408.5 billion, or reached 38.1% of Gross Domestic Product (GDP). This figure increased compared to the previous month which was 37.4%. The foreign debt position for 3Q20 consists of external debt from the public sector (government and central bank) amounting to USD 200.2 billion and foreign debt from the private sector (including BUMN) worth USD 208.4 billion. On the other hand, BI said the structure of Indonesia’s foreign debt remained healthy, as reflected in the large share of long-term foreign debt which reached 89.1% of total foreign debt. (Kontan)

Pay close attention to Benchmark Candidates at the End of Year Auction. Investors have the opportunity to return to interest FR0086 and FR0087 at the SUN auction today. The two series are candidate benchmarks for 5-year and 10-year tenors, respectively. Both series also recorded high interest in the previous SUN auction. This is also supported by a trade balance surplus, which will encourage further strengthening of the rupiah. Yesterday, rupiah strengthened 0.42% to IDR 14,110 / USD level on the spot market. The appreciation of the rupiah was also a response to the signing of the Regional Comprehensive Economic Partnership (RCEP) free trade agreement between 15 countries in Asia Pacific, one of which is Indonesia.

-REVIEW (Nov. 16, 2020)-
FR0081 (5yr): -8.2 Bps to 105.03 (5.24%)
FR0082 (10yr): -5.3 Bps to 105.65 (6.22%)
FR0080 (15yr): -5.6 Bps to 106.79 (6.75%)
FR0083 (20yr): -3.5 Bps to 103.24 (7.18%) (as of Nov. 13, 2020)

FR0086 (6yr): -5.9 Bps to 101.04 (5.27%)
FR0087 (11yr): -4.2 Bps to 101.61 (6.28%)

UST 2yr: -0.003 point to 0.17%
UST 5yr: -0.000 point to 0.40%
UST 10yr: +0.010 point to 0.90%
UST 30yr: +0.016 point to 1.66%
German Bund 10yr: +0.003 point to -0.54%
UK Gilt 10yr: +0.011 point to 0.34%

CDS 2yr: -5.49% to 28.27
CDS 5yr: +7.76% to 75.84
CDS 10yr: -1.33% to 137.53

WTI: -2.40% to USD40.13/Barrel
BRENT: -1.72% to USD42.78/Barrel
Source: Bloomberg