Danantara launched debut $1 billion bond sale in test for Indonesia

A unit of Indonesia’s sovereign wealth fund Danantara launched its first US dollar bond sale on Thursday, seeking as much as $1 billion in a closely watched gauge of foreign demand for Indonesian risk. Danantara Investment Management marketed five-year and 10-year notes, targeting about $500 million from each tranche. Final guidance tightened from earlier levels to 5.35% for the five-year bonds and 5.95% for the 10-year bonds. The sale comes as investors weigh pressure on the rupiah and concerns over President Prabowo Subianto’s economic agenda. Bank Indonesia this week made a rare off-cycle rate increase to 5.5% after the currency hit record lows. Proceeds will go to general corporate purposes, including investments and refinancing debt.