• Foreign holdings of MYR debts securities decreased to RM175.9bn

• Foreigners sold RM3.8bn of MGS and RM0.5bn of GII

• Total portfolio outflow of RM6.24bn for equities and debt securities combined

• MYR bonds remain supported although global sentiment remains soft

Foreign funds remained net seller of domestic debts with a net loss of RM4.2bn in May. This brought the total stock of foreign holdings lower to RM175.9bn in May, equivalent to 11.9%. This was the lowest since February 2010 (11.2%). However, total outstanding and foreign holdings in 2010 was much lesser when compared to 2019 figures.

Foreign investors sold Malaysia’s debt securities in May as total foreign holdings decreased by RM4.2bn to RM175.9bn. Foreign holdings of MGS declined by RM3.8bn to RM143.3bn (Apr: RM147.1bn; Mar: 150.7bn; Feb: RM149.3bn; Jan: RM144.4bn). Foreign investors also reduced their holdings of GII by RM0.5bn to RM14.7bn (Apr: RM15.2bn; Mar: RM18.7; Feb: RM17.4bn; Jan: RM16.6bn). Given the net outflow of RM4.3bn to RM158.0bn in foreign ownership of government debt (MGS + GII), total foreign holding in government debt edged lower to 21.7% from 22.7% in Apr.

Foreign holdings of discount instruments remained stable at RM5.9bn. Foreign holdings of PDS increased slightly by RM0.1bn to RM12.0bn. As a result, in combined amounts (inclusive of short-term bills/notes and corporate bonds/sukuk), foreign holding levels in May 2019 were lower by RM4.2bn, bringing total foreign ownership of MYR bonds to RM175.9bn or 11.9% (Apr: 12.5%).

As at end-May, international investors sold RM4.2bn of Malaysian bonds (Apr: - RM9.9bn; Mar: +RM3.0) whilst the Malaysian equity market recorded total foreign outflow of RM2.04bn (Apr: -RM1.4bn; Mar: -RM1.6bn). This means a total portfolio outflow of RM6.24bn for equities and debt securities combined. Meanwhile, in the corresponding period, Malaysia’s foreign international reserves decreased by USD1.1bn to USD102.3bn (Apr: USD103.4bn; Mar: USD103.0bn).

Source: BIMB Securities Research - 12 Jun 2019