UPDATE 1-Indonesia raises 5.55 trln rph in bond auction

(Adds details, analyst's quotes)

JAKARTA, June 24 (Reuters) - Indonesia sold 5.55 trillion rupiah ($599.1 million) worth of debt paper, almost double its indicative target, in a bond auction on Tuesday suggesting stronger sentiment in the domestic market after global bond sales.

But analysts said the domestic bond market is still fragile on concerns over domestic inflationary pressures after the fuel price hike and external factors such as soaring global oil and food prices.

The 15-year treasury bonds were priced to yield 13.62 percent, while the treasury bills, which will mature in April 2009, were priced to yield 10.53 percent.

The ministry also auctioned the 7-year fixed rate bonds but there were no winning bids. The ministry had expected to raise 3 trillion rupiah from the auctions.

"The appetite is there and the yields are very interesting, but investors might still be cautious with global issues such as soaring prices of food and oil," said Benny Tjandraputra, head trader fixed income at NISP bank.

He added sentiment was better after the global bond sales last week as the market saw Indonesia on track to meet its bond issuance target for this year.

Southeast Asia's biggest economy has set a target of 157 trillion rupiah from gross bond issuances in 2008 to help plug the budget deficit which is forecast at 2.1 percent of GDP.

Indonesia sold $2.2 billion worth of global bonds last week, which brought the bond issuance figure to 75.296 trillion rupiah as of June 19, or about 48 percent of this year's target.