Malaysia bond market weekly updates 27 August 2017

This week, the local market, yields continued to ease following the healthy second quarter GDP reported last week, in conjunction with the stronger ringgit. Meanwhile, risk aversion stemming from President Donald Trump’s threat for a government shutdown also sent MGS yields south, tracking the overnight US Treasury yields.

As a result, MGS yields lowered by 2 to 4 bps across the curve and the Thomson Reuters BPAM All Bond Index posted gains of 0.201 per cent to close at 154.359 points from 154.05 points recorded last week.

On August 22, Bank Negara () reported that the international reserves amounted to US$100.4 billion as at 15 August 2017, up from US$99.4 billion recorded two weeks ago.

The reserves position is sufficient to finance 7.9 months of retained imports and is 1.1 times the short-term external debt.

Looking at the top 10 most active bonds, total trade volume of the week amounted to approximately RM8.8 billion. The 7-year (09/2024) and 10-year (11/2027) benchmark MGS papers topped the list with RM2.0 billion and RM1.4 billion trades done respectively.

On sovereign auction, on August 25, BNM announced the tender details for the re-opening of the RM3.5 billion 7-year benchmark MGII maturing on 15 August 2024. The tender will be closed on 29 August 2017 and the MGII will be re-opened on the following day.

For new issuances, Sunway Treasury Sdn Bhd on August 24 issued a 5-year Islamic Medium Term Notes (IMTN) worth RM150 million. The Sunway Berhad-guaranteed carries a profit rate of 4.90 per cent and is rated AA-IS (CG) with stable outlook by .

On August 25, Sabah Development Bank Bhd issued a 3-year MTN worth RM30 million with a coupon rate of 5.15 per cent. The MTN is rated AA1 with stable outlook by RAM Ratings.

Source: Borneo Post Online

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