Bloomberg News

Indonesian Bonds Complete Fourth Weekly Gain on Funds Inflows

October 21, 2011

Oct. 21 (Bloomberg) -- Indonesia’s bonds completed a fourth weekly advance after global funds added to holdings of the nation’s assets.

International investors boosted ownership of sovereign notes to 218.5 trillion rupiah ($24.5 billion) as of Oct. 19, an increase of 1 trillion rupiah from the end of last week, according to the finance ministry’s website. The rupiah fell today on concern Europe’s lingering debt crisis will stall a global economic recovery. Bank Indonesia is selling dollars when needed to ease volatility in the local currency, Deputy Governor Hartadi Sarwono said Oct. 7.

“We saw increased investment in bonds,” said Wiwig Santoso, head of treasury and markets at PT Bank DBS Indonesia in Jakarta. “The central bank has been monitoring global developments and the potential impact on the onshore market.”

The yield on the government’s benchmark 10-year notes slid three basis points this week to 6.35 percent today, according to the Inter-Dealer Market Association. The rate rose four basis points today. It has dropped 59 basis points, or 0.59 percentage point, this month after the central bank cut its benchmark interest rate by 25 basis points to 6.50 percent on Oct. 11.

The rupiah dropped 0.4 percent today and 0.2 percent this week to 8,863 per dollar as of 3:45 p.m. in Jakarta, according to prices from local banks complied by Bloomberg.

--Editors: Ven Ram, Andrew Janes

To contact the reporter on this story: Khalid Qayum in Singapore at

To contact the editor responsible for this story: Sandy Hendry at

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