Fixed Income

Fixed Income Update 28 Mar 2024

Fikri C. Permana 28 Maret 2024

Thursday, 28 March 2024

The Volatility of Exchange Rates Drive Sentiment in The Fixed Income Market

US New orders for manufactured durable goods in Feb’24 increased by 1.4%, along with core durable goods orders +0.5% MoM. This indicates the continued strength of demand in the US. The increase in Durable Goods Orders was propelled by rises in orders for Transportation Equipment (3.3% MoM), particularly Motor Vehicles&Parts (1.8% MoM); Machinery (1.9% MoM); Fabricated Metal Products (0.8% MoM); Primary Metals (0.8% MoM); and Capital Goods (1.9% MoM).

The consistently low weekly initial jobless claims reflect the robust condition of the labor market in the US. The residential housing market in the US demonstrates a trend of decline. This is evident from :
•    New Home Sales in Feb’24 unexpectedly dropping by -0.30% MoM to 662K
•    US House Prices in Jan’24 experiencing a decline for the first time in 17 months
•    Meanwhile, the 30-year fixed mortgage rate as of 21 Mar 24, rising by 13 bps to 6.74%

The release of PCE Price Index and labor market conditions indicated by weekly jobless claims are expected to once again become the primary drivers of sentiment in the global market next week, alongside Fed Chair Powell’s Speaks. Meanwhile, in Indonesia, the release of the PMI (Purchasing Managers’ Index) and inflation data on 1 Apr 24, will be eagerly awaited by the market.


KBVS Research Team