Bank Indonesia.The Indonesian government said Friday that it will use the yield of its three-month bonds as a reference in deciding the yield of its existing IDR142.79 trillion ($16.4 billion) in bonds that bear variable coupons.
Previously the reference was the yield of the three-month Sertifikat Bank Indonesia note issued by the central bank. The central bank stopped auctioning those money market securities late last year to reduce fund inflows, making it necessary for the government to use another rate as a reference.
At the most recent auction Tuesday, the three-month bonds were yielding 5.12%, significantly lower than the yield of Bank Indonesia's latest three-month note of 6.367%. The government will again auction three-month bonds next month.
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