SUN’s Price Slump Dangers the Government Projects

The price of the government bonds in the secondary market corrected on Tuesday morning (9/3), following the uncertainty of the global economy, the economic slowdown of several developed countries. The ongoing trade war between the US and China has corrected the economic projection of those countries. Such conditions have caused the growth of global investment in the capital market where stock exchanges or bonds are traded remains in doubt.

SUN, or the government debt papers, becomes the reference of such uncertainty since it is the most traded bonds in the secondary market. The price change of SUN portrays the general condition of Indonesian bond market. There are four SUN bonds which become the benchmark: FR0077 with a five-year tenor, FR0078 with ten-year tenor, FR0068 with 15-year tenor, and FR0079 with a 20-year tenor. Their prices have slumped, marked with the increase of yield. The most weakened bond is FR0078, with the yield has increased from 7.29 percent to 7.33 percent.