Investors responded positively to the Bank Indonesia Seven Days Reverse Repo Rate (BI 7-DRRR) cut by 25 bps to 3.75%, after 4 months the benchmark interest rate was held at 4%.
The benchmark series of Government Securities (SUN) closed mixed yesterday, in line with the waiting for the results of the Board of Governors’ Meeting (RDG) of Bank Indonesia (BI) this afternoon.
This can be seen from the increasingly competitive yields, with a decrease in the weighted average yield (WAY), both for the series FR0086, FR0087, FR0080 and FR0083 at the auction of Government Securities ) Last Tuesday.
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.
BBNI’s net interest income (NII) was stagnant at IDR 26.6 trillion in 3Q20, compared to 3Q19. This resulted in net income of IDR 4.3 trillion, lower 64% YoY than in 3Q19 at IDR 11.9 trillion.
A number of market players, especially foreign investors, responded positively to Biden’s victory. This has benefited emerging market countries such as Indonesia, following the end of the trade war between the US and China.
Prices of all benchmark series Government Bonds (SUN) turned downward due to profit taking by investors. Apart from the appreciation of the rupiah, the yield movement has decreased since October 2020 and amidst strong sentiment regarding the success of the Pfizer vaccine.
The election of Joe Biden as the new president of the United States (US), creates new hopes for the market. Investor project that global market conditions will be more conducive than the Trump administration.
Biden’s victory has the opportunity to make foreign funds back into Indonesia, especially the bond market. Although the rupiah was overshadowed by a decrease in foreign exchange reserves, market players had anticipated this
