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Events of Bonds Market in US

Following the election of Trump and a Republican


majority in both houses of Congress, interest rates rose
and the Treasury yield curve steepened as the market
digested increased prospects of fiscal stimulus through
spending and tax cuts and their potential impact on
economic growth and inflation, two of the key drivers
of interest rates.
Milestone of US Bonds Market
Gauging gradual progress
Returns losing steam, not broken
Search for yield isnt over
Bank on higher short-term rates
Municipal outlook
Gauging gradual progress
Fixed income plays a vital role in a well-diversified
portfolio. Even in a low return, low-yield
environment, high-quality bonds serve as an
important diversifier, helping to manage risk from
equities and other higher risk asset classes.
Returns losing steam, not broken
The onset of a U.S. recession or a major unexpected
shock to the global economy could push rates lower
and bond prices higher; however, prices on high-
quality fixed income securities are more likely to be
under pressure from several major sources in 2017.
Search for yield isnt over
High-yield bonds and bank loans could be two
potential ways to help some suitable investors
increase yield in their fixed income portfolios, in what
is still a historically low-rate environment.
Bank on higher short-term rates
While longer-term Treasury rates are largely driven
by expectations of future U.S. economic growth and
inflation, short-term Treasury yields are more
sensitive to Fed policy. With the prospects of
additional Fed rate hikes in 2017, short-term rates
are poised to continue to move upward.
Municipal outlook
Post-election, as fixed income markets digested the
economic implications of a Trump presidency, yields
in the tax-sensitive municipal market began to spike,
though not as much as Treasury yields. Prices should
stabilize relative to Treasuries once the new
administration clarifies its tax policy.
Milestone and Events for Bond Market in
Indonesia
The Indonesian government has estimated its
infrastructure investment needs at a
substantial $80 billion per year. A deeper and
more vibrant domestic bond market could play
a key role in financing future growth, help
companies rely less on foreign currency bond
issuance and reduce vulnerabilities to
exchange rate fluctuations.
Milestone of Bond Market in Indonesia
the development of Indonesia's bond market has
been dominated by government bonds, while the
corporate sector has lagged, accounting for only 14%
of the local currency bond market.
Milestone of Bond Market in Indonesia
Companies do turn to the bond market for financing,
they tend to issue in foreign currencies. The ratio of
companies' foreign currency bond issuance to rupiah
bond issuance is 1.4 in Indonesia. On the supply
side, the authorities should work to encourage
greater use of the bond markets for financing by
companies.
Milestone of Bond Market in Indonesia

Another constraint on the greater use of bond


financing is the higher level of information and
disclosure demanded by potential bond
investors.

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