KUALA LUMPUR (May 15): The Malaysian onshore financial markets remained stable and orderly post-general election, the Financial Markets Committee (FMC) said, adding that they continue to function in an effective manner, facilitating smooth intermediation activities among market participants.

In a statement today, the FMC — which comprises representatives from Bank Negara Malaysia, financial institutions, corporations and financial service providers — said since the re-opening of the onshore ringgit market on Monday, the ringgit has traded close to its last traded price prior to the 14th general election (GE14), hovering around 3.95, after an initial opening of 3.97.

"(This) signaled continued investors' confidence of the new government," as commented by Financial Markets Association of Malaysia president Datuk Lee Kok Kwan.

The onshore foreign exchange (FX) market remains active, recording a daily average volume of above US$15 billion after the election. Other key domestic markets including government bonds, corporate bonds and money markets remain supported by investors as evidenced by the strongest year-to-date bid-to-cover ratio of 3.4 times for the re-opening of the seven-year Malaysian Government Investment Issue.

While financial intermediation continues to be undisrupted by ample liquidity in the markets, the FMC said Malaysian economic fundamentals remain strong, reinforced by current account surplus, strong reserves position, low level of external indebtedness and a well-capitalised banking system.

"The FMC will continue to monitor these developments and work with financial market participants, which includes taking proactive measures, to address any further volatility that could emerge from the transition process to ensure orderly functioning of our financial markets," it added.