Malaysian Bond Market

In the local bond market, buying momentum lifted by strengthening ringgit, the trading activities were seen on the belly part of the curve mostly driven by foreign funds. Longer end of the yield curve flattened 3-5 bps while shorter end to belly narrowed 1-2.4 bps.

Meanwhile, the volume from government issues held strong despite lesser trading hours, with a total of RM12.46bil from last week RM12.19bil, with higher interest from Government Investment Issue (GII) paper of RM3.55bil.

As at yesterday afternoon, the 3-, 5- ,7- ,10- ,15- ,20- and 30-year benchmark Malaysian Government Securities (MGS) yield settled at 3.56%, 3.72%, 3.87%, 4.00%, 4.33%, 4.49% and 4.74%, respectively.

In the govvies segment, total treasuries volume saw an uptick of 2.2% from RM12.19bil to RM12.46bil. The MGS increased from RM8.59bil to RM8.86bil while GII attracted RM3.55bil. On the other hand, private debt segment dropped significantly to RM394mil from last week’s RM1.43bil.

The GG/AAA segment was mostly traded as it attributed three quarters of this week’s trade with the AA and A segments contributing 10.2% and 9.8% respectively.

In the GG/AAA segment, flows were focused on MKD Kencana Sdn Bhd ‘10/32 paper which saw RM70mil changing hands at 4.590%. Next, Prasarana Msia Bhd ‘09/24 issuance attracted RM60mil at 4.079%, followed by its Islamic medium-term notes ‘03/25 paper traded at 4.100% on the back of RM60mil.

On the AA-rated front, notable trade included Sarawak Energy Bhd ‘04/31 which posted RM20mil at 4.682% and Besraya (M) Sdn Bhd ‘07/28 traded at 5.039% on top of RM10mil changed hand.