KUALA LUMPUR (Jan 17): Foreign holdings of Malaysian Government Securities (MGS) are reported to have increased to a new peak of about RM257 billion in December 2021 from RM223 billion the year before, MIDF Amanah Investment Bank Bhd analysts wrote in a note on Monday (Jan 17), citing Bloomberg and MIDF data.

"Moreover, the latest figure surpassed its recent peak of RM254 billion in October 2021,” MIDF added. 

For the week ended Jan 14, 2022, MIDF, citing Bloomberg data, said the total trading value of Malaysian government bonds comprising the conventional MGS and Islamic-compliant Government Investment Issues increased to RM21.33 billion from RM16.93 billion the week before.

Total trading value of the 10 most-actively transacted securities declined to 54% from 71% of overall government bond trades, according to the research house.

"Moreover, seven out of the 10 most-actively traded bonds saw lower yields, hence higher prices during the review week.

"The prices of domestic MGS benchmark issues ended the review week higher with the three-year and 10-year yields shedding 5.5 basis points (bps) and 1.2bps to close at 2.79% and 3.63% respectively. The 10-year-three-year yield spread expanded (the yield curve steepened) week-on-week from 80bps to 84bps as the short end outperformed,” MIDF explained.