KUALA LUMPUR: Foreigners continued to purchase Malaysian bonds in April, where more than 90% went to government bonds – Malaysian Government Securities (MGS) and Malaysian Government Investment Issues (MGII).
RAM Rating Services said net foreign purchases of Malaysian bonds in April rose to RM6.4bil from RM5.9bil in March.
“This extends the current streak of foreign buying to 12 months for a total of RM60.2bil, ” it said in a statement on Friday.
The rating agency said more than 90% of this total purchase went to government bonds (that is MGS and GII), mainly underpinned by “sticky” investors (that is central banks, governments, pension funds and insurers).
RAM pointed out that amid steady foreign appetite and abating selling pressure, domestic bond yields tumbled in April.
Hence, the benchmark 10-year MGS yield fell 10.8 bps to 3.14%, the first month-on-month 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, ” RAM said.
