US 2-Year Yield Eases, Indonesia's FX Carry Improves

US front-end yields and Brent crude prices have eased, while Bank Indonesia's rate hikes have improved FX carry for the Rupiah. The market is focused on US PCE data and a potential hawkish hold from the Bank of Korea.

Key Takeaways

• 1.The US 2-year Treasury yield has retraced to 4.03%, suggesting a potential downward shift in front-end rates despite markets pricing in a 60% chance of a Fed hike.
• 2.Indonesia's FX carry has improved significantly due to Bank Indonesia's 50bp rate hike, making the Rupiah more attractive despite macro headwinds like a widening current account deficit.
• 3.Brent crude prices have fallen below $95/bbl amid optimism for a US-Iran deal, though negotiation progress remains uncertain.

Table of Contents

• Market Highlights
• Ahead Today
• INDICATIVE RATES
• FOREIGN EXCHANGE
• Disclaimer
• CERTIFICATION
• DISCLAIMERS
• Legal entities and branches
• General disclosures
• Country and region specific disclosures

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