Early Ramadan 2024, SUN Auction Entrance Offer Reaches IDR 58.94 Trillion

Rupiah (Photo: Antara)

JAKARTA - Director of Government Securities, Directorate General of Financing and Risk Management of the Ministry of Finance, Deni Ridwan conveyed that the offer for SUN Auction at the beginning of Ramadan 1445 H was quite well recorded.

The total incoming bids at today's SUN auction reached IDR 58.94 trillion or 2.45 times the indicative target previously announced.

"This is supported by constructive domestic economic indicators, including the high level of foreign exchange reserves at the level of US$144.0 billion which is equivalent to financing 6.5 months of imports or 6.3 months of imports and payment of government foreign debt," he explained in his official statement, Wednesday, March 13.

Deni said another factor from the global market, Fed Chairman Jerome Powell, indicated a possible decline in the Fed Fund rate this year, although the decline was not yet possible in the first semester of 2024, as the US inflation rate has not yet approached the Fed's target.

On the other hand, the total supply of foreign investors at today's SUN auction increased slightly to Rp10.5 trillion from Rp10.4 trillion in the previous auction.

The majority of the incoming bids are in the medium-long (5 and 10 years) tenor SUN series of IDR 7.97 trillion or 75.9 percent of the total foreign investor entry offers and won IDR 4.63 trillion or 19.3 percent of the total bids won.

According to Deni, investor demand is still dominant in the 5 and 10 year SUN tenor series, with a total incoming offer and an offer winning each of 64.99 percent of the total incoming bids and 58.13 percent of the total winning bids.

Meanwhile, the largest entry offer in 10 years was IDR 19.44 trillion or 32.98 percent of the total incoming bid and won IDR 9.1 trillion or 37.92 percent of the total bid won.

Deni conveyed that the Weighted Average Yield (WAY) for State Bonds at today's SUN auction increased by 1 to 3 bps compared to WAY in the previous SUN auction, except for WAY, the State Bonds were tenor 5 years down 1bp compared to WAY in the previous SUN auction.

According to Deni, the Government decided to win an offer of IDR 24 trillion at today's SUN auction by considering reasonable SBN yields in the secondary market, planned financing needs in 2024, and the current state treasury conditions.

"In accordance with the calendar for issuance of Government Securities (SBN) in 2024, the auction for the issuance of SUN will then be held on March 26, 2024," he concluded.