All Bursa-listed banks are delivering better Q4 2021 results. Better loan growth, net interest margin expansion, lower cost to income ratio, and lower gross impaired loan.

If you compare the yield curve of October 2021 and February 2022, you will realize that the yield curve had steepened even more and this means better profit for banks via net interest margin expansion.

However, we notice that the Malaysia Government Securities (MGS) yield curve, which is the yield curve of Malaysia government bonds is starting to turn inverted. 7 years yield is higher than 10 years yield and 20 years yield is higher than 30 years yield.

We are not sure whether the higher yield on 7 years duration bonds and 20 years duration bonds is due to a lack of liquidity or bond traders are expecting something to happen. Let's watch the yield curve carefully.

You can track Malaysia government bond monthly yield curve here: MGS Monthly Yield Curve

In case you do not know what is the implication of different type of yield curve, you can check out the guide here: Yield Curve Guide