Government Bonds
Market participants have predicted that the BI 7-DRRR benchmark interest rate will remain at 3.50%. On the other hand, the increase in positive cases of Covid-19, especially in the DKI Jakarta area, is still a negative sentiment. The Ministry of Health reported that the total number of positive corona patients in the country reached 1,950,276 as of last Thursday (17/06). The highest daily gain since January 30, 2021. The benchmark 10-year yield FR0087 closed at 6.51% based on NH Korindo Sekuritas data.

Corporate Bonds
Indomobil Finance Bonds mature in August. Indomobil Finance Indonesia’s bonds are rated idA with stable prospects from the Indonesian Securities Rating Agency (Pefindo). Pefindo considers that the Shelf Registration Bond IV Phase I Year 2020 Series A from Indomobil deserves an idA rating. Its ranking history has been stable since last year. The IDR 229 billion bond will mature in the next two months, namely August 14, 2021. Pefindo has assigned the idA rating because Indomobil is considered to have adequate cash conditions. Indomobil will repay the bonds using cash and cash equivalents worth IDR 848.7 billion. (Bisnis Indonesia)

Ministry of Finance Prioritizes Carbon Tax. The Ministry of Finance revealed that the government will prioritize the implementation of the carbon tax levy plan, strengthening anti-tax avoidance, and expanding the excise object to increase the coffers of state revenue rather than the value added tax (VAT) for basic commodities. As for the VAT for basic necessities, the implementation will not be in the near future, especially during the current corona virus pandemic. The application of VAT levies on basic necessities will be carried out when the economy has recovered. Moreover, the policy plan to expand the VAT rate will only be formally submitted by the government to the DPR through the Plenary Meeting which will be held on Tuesday (22/6). (CNN Indonesia)

Lack of Sentiment and Strict Restrictions. The movement of the Government Bond (SUN) market this week is likely to be flat, in line with the lack of sentiment on domestic economic data. On the other hand, market participants will focus on the increase in new cases of Covid-19. This increase is feared to make the government re-impose a stricter activity restriction policy. Tomorrow, the government will offer seven series in the SUN auction, namely SPN03210922 (New Issue); SPN12220331 (Reopening); FR0086; FR0087; FR0088; FR0083; and FR0089.