Fixed Income Update 10 Oct 2024
KBVS WEEKLY FIXED INCOME UPDATE
Thursday, 10 October 2024
Cautiosly Optimistic
- Opportunities amidst Pressure
Strong U.S. labor market data—particularly Average Hourly Earnings, Non-Farm Payrolls, and the Unemployment Rate—has alleviated concerns about a potential hard landing for the U.S. economy. However, it has also raised worries that inflation in the U.S. remains persistent. This dynamic has reduced the likelihood of a significant Fed rate cut in the near future. As a result, global markets have responded by rebalancing their portfolios.
The rise in the DXY has driven the Rupiah's JISDOR exchange rate to IDR 15,671 per USD as of Oct 8, ‘24, its lowest level since Aug 16, ‘24. Similarly, the yield on the SUN10Y climbed to 6.73% on Oct 8, ‘24, the highest level since Aug 14, ‘24. While domestic financial market pressures are largely driven by DXY movements and U.S. economic conditions, we also see this as an opportunity for a buy-on-weakness strategy in domestic assets currently under pressure.
Regards,
KBVS Research Team