Published on 21 May 2021.
Net foreign purchases of Malaysian bonds continued in April 2021, accelerating to RM6.4 bil from RM5.9 bil in March. This extends the current streak of foreign buying to 12 months for a total of RM60.2 bil. More than 90% of this total purchase went to government bonds (i.e. MGS and GII), mainly underpinned by ‘sticky’ investors (i.e. central banks, governments, pension funds and insurers).
Amid steady foreign appetite and abating selling pressure, domestic bond yields tumbled in April. The benchmark 10-year MGS yield fell 10.8 bps to 3.14%, the first m-o-m decline in three months. The reprieve from the global sell-off also halted the rise in US Treasury (UST) yields last month; the 10-year UST yield ebbed 9 bps m-o-m (March: +30 bps). Regional markets also followed suit, with 10-year government bond yields in Singapore, Thailand and Indonesia declining 15.0, 13.4 and 23.9 bps respectively in the same period.
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