We view that an upward trend at the beginning of the year is inevitable amid strong external pressures, where central banks in developed countries, particularly the US, have begun to take steps to tighten monetary policy. While domestic fundamentals are expected to remain stable, with inflation and interest rates remaining unchanged in the early months of 2022, such external sentiments have impacted upward pressure on government bond yields. In addition, we also view that translation risk, particularly from the trade balance and oil prices, is another source of pressure on bond yields. As a result, based on the Bloomberg consensus, government bond yields for the benchmark tenor, 10 years, are expected to move higher in the range of 6.380%-6.520% in the first quarter of 2022.
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