-GOVERNMENT BONDS-
Rupiah Towards IDR 15,000/USD, Varied SUN Market. Sentiment of the rupiah exchange rate colored the beginning of the week’s trading. Rupiah weakened 0.56% to IDR 14,785/USD. Economic uncertainty due to the pandemic has again put pressure on the rupiah, amid waiting for the release of Indonesia’s 2Q20 GDP data next month (08/05). Meanwhile, external sentiment still stemmed from tensions between the US and China, and the wait for a decision on the EU stimulus package. On the other hand, the rupiah exchange rate is still likely to weaken related to the growing sentiment of corona virus cases, both from domestic and abroad. Market participants are also still looking at global economic conditions.
-CORPORATE BONDS-
Tunas Pratama Solutions Issues IDR 8 Trillion Bonds. Issuers of telecommunication tower providers, Solusi Tunas Pratama Tbk (SUPR IJ) designed bond issuance both in rupiah and US dollar denominations to increase the company’s liquidity. First, denominated in United States dollars worth USD 400 million or equivalent to IDR 5.56 trillion. Second, with IDR 8 trillion. Tunas Pratama’s solution indicates that the bonds will have a 7-year tenor with a maximum interest rate of 8%. For the corporate action plan, SUPR will ask for approval in an extraordinary general meeting of shareholders which will take place on July 22, 2020. The bond listing is planned to be carried out on the Indonesia Stock Exchange.
-MACROECONOMY-
Three Stimulus of Economic Recovery in 2021. Minister of Finance Sri Mulyani Indrawati emphasized that the government will continue the three social protection stimulus until 2021. The program is part of the National Economic Recovery (PEN) program, including social assistance (Bansos), the family of hope program (PKH), and food supplies. For the record, the realization of social protection from the beginning of March to 20 July 2020 amounted to IDR 77.4 trillion, equivalent to 37.96% of the total stimulus budget of IDR 203.9 trillion. The amount of the budget is channeled to the IDR 37.4 trillion Family Hope Program (PKH), IDR 43.6 trillion groceries, IDR 6.8 trillion Jabodetabek Bansos, and IDR 32.4 trillion non-Jabodetabk Bansos. Then, the pre-employment program is IDR 20 trillion, electricity discount is IDR 6.9 trillion. Then logistics, food, groceries IDR 25 trillion, Direct Cash Assistance (BLT) IDR 31.8 trillion.
-RECOMMENDATION-
Foreign Investors Calculate Fair Yield. As the largest portion of SBN ownership, foreign investors are recalculating the fair yield of Indonesian domestic SBN. Foreigners are aware of the impact of the widening budget deficit on the economy, amid the Indonesian government is again aggressively offering debt securities. The increase in supply of debt securities will make the bond market volatility higher, making foreign investors will not be aggressive and tend to consolidate. Today, again offer PBS028 New Issuance in the Sukuk auction. The 26-year PBS028 will complement other long-term Sukuk, such as the 23-year PBS005 and the 27-year PBS015. At the close of Monday, the rupiah weakened 0.56% to a level of IDR 14,785 / USD on the spot market. Meanwhile, the middle exchange rate of the BI rupiah weakened 0.35% to the level of IDR 14,832 / USD.
Reference
https://www.cnbcindonesia.com/market/20200720164251-17-174070/sentimen-beragam-obligasi-ri-bergerak-variatif
http://idnbonds.com/solusi-tunas-pratama-bond-issuance/
http://idneconomics.com/indonesia-economic-stimulus-in-2021/
