The government raked in US$2.2 billion Tuesday by selling dollar-denominated bonds in New York, higher than the $1.5 billion target, drawing record bids from investors, an official says."It was the largest book order of Indonesian bonds," Finance Ministry's director general of debt management Rahmat Waluyanto said in a text message Tuesday (Wednesday Jakarta time).
The bond sale attracted $6 billion of bids.
The government, Rahmat said, sold $300 millions of Indo-14 bonds maturing in March 2014 with a 6.69 percent yield, $900 million in Indo-18 notes maturing in January 2018 with 7.28 percent yield and $1 billion in Indo-38 notes due in January 2038 with an 8.15 percent yield.
It was "a very positive response from investors, boosted by Indonesia's improved credit ratings and strengthening economic fundamentals ... amid the difficult global conditions", Rahmat said.
In August, the government plans to sell its first Islamic bond (sukuk) to the domestic market. It plans also to sell sukuk to the international market in October, aiming to tap funds from Middle Eastern investors who are reaping windfall profits due to the soaring oil prices.
The government last sold dollar-denominated bonds in January, raising $2 billion. Indo-18 notes were sold with a 6.95 percent yield and Indo-38 bonds at 7.74 percent.
Hartadi A. Sarwono, the central bank deputy governor, said the dollar-denominated bond sale would improve market sentiment and strengthen the rupiah.
"The sale will go to our foreign reserves and the money can be used to buy the rupiah," Hartadi said.
As of May, the central bank's foreign reserves stood at $57.46 million.
source: Jakarta Post | 19 June 2008
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