BPA Malaysia weekly bond market report 16 July 2017
The focus shifted towards the Semi-annual Monetary Policy speech delivered by Federal Reserve chairwoman Janet Yellen to the Congress on Wednesday. US treasuries yield eased lower following the dovish view from the US central bank that monetary policy will be tightened on a gradual pace due to concerns over the weakness in inflation rates that consistently buoyed below the two per cent target rate. Despite the strength in the US treasuries, trading activity in the local bond market remained light. The TR BPAM All Bond index ended the week marginally higher by 0.09 per cent to close at 153.092 points from 152.954 points in the previous week.
On July 12, 2017, Department of Statistics Malaysia published the Index of Industrial Production (IPI) for the month of May 2017. The IPI grew 4.6 per cent as compared to the same month of the previous year, supported by the strong growth in Manufacturing index (7.3 per cent) and Electricity index (2.5 per cent).
On July 13, 2017, BNM in its latest MPC meeting decided to keep the OPR unchanged at three per cent. In the latest MPC statement, BNM concluded that the Malaysian economy performed better than expected in the first quarter of 2017.
The total trade volume of the top 10 most active bonds stood at RM5.4 billion from RM7.7 billion last week. The MGS maturing on February 7, 2018 topped the list with RM819 million changed hands.
On July 12, 2017, BNM announced the details for the re-opening of the 30-year benchmark MGII maturing on May 8, 2047.
On July 7, 2017, RAM Ratings revised the outlook on Tan Chong Motor Holdings Bhd’s (TCMH) long-term ratings to negative from stable. The revision of the outlook is premised on concerns that continued challenging operating conditions could derail the group’s recovery over the next two to three years.
On July 11, 2017, RAM Ratings revised the outlook on the AA3(s) rating of Country Garden Real Estate Sdn Bhd’s IMTN Programme of RM1.5 billion in Nominal Value (2015/2035) to stable from negative while reaffirming the rating.
On July 14, 2017, MARC revised the outlook on Special Port Vehicle Bhd’s (SPVB) asset-backed serial bonds facility to stable from negative while reaffirming its AAA rating. The outlook revision is premised on the sufficient amount in SPVB’s designated accounts to meet the RM180 million upcoming final principal repayment of Series 11 bond due on July 28, 2017. The designated accounts balance stood at RM229.95 million following the receipt of the final deferred repayment obligation of RM179.63 million from Port Klang Authority (PKA) on 30 June 2017. The deferred repayment obligation is as per the Sale and Purchase Agreement signed between the project originator, Kuala Dimensi Sdn Bhd and PKA in November 2002 for the purchase of 999.5 acres of land at Pulau Indah for the Port Klang Free Zone project.
Source: Borneo Post Online