Fixed Income Update 31 Oct 2024
KBVS WEEKLY FIXED INCOME UPDATE
Thursday, 31 October 2024
Trump = Uncertainty
The increasing likelihood of a Trump victory has fueled global inflation expectations. Key policies associated with Trump, such as immigration restrictions, the Trump Tariff, and tax cuts, are anticipated to heighten economic uncertainty worldwide.
This outlook has already triggered capital outflows from Indonesia in the past week, particularly in the tradable SBN, totaling IDR3.32 tn. Consequently, SUN yields have risen in parallel with the yield increase observed in US government bonds. Additionally, with the DXY index remaining above the 104 level, the Rupiah also depreciated last week.
Market participants are now closely watching the release of inflation and GDP growth data to help alleviate concerns over economic uncertainties and to address fears of weakening domestic purchasing power. Alongside these domestic indicators, global sentiment will also be shaped by the release of U.S. PCE price data, used by the Fed as a measure of purchasing power, and by US labor market data.
Regards,
KBVS Research Team