Bank Negara international reserves at RM409 bil end-2015

KUALA LUMPUR: Bank Negara Malaysia’s (BNM) saw an increase in its international reserves at end-2015 which rose to RM409.1bil from RM405.4bil at end-2014.

The central bank said on Thursday that in US dollar terms, the forex reserves fell to US$95.3bil from US$115.9bil. 

“The reserves level as at Dec 31, 2015 has taken into account the adjustment for foreign exchange revaluation changes,” it said. The ringgit weakened by about 18% against the US dollar in 2015.

BNM said the level of reserves during 2015 remained supported by the current account surplus and inflows of foreign direct investment in an environment of reversal of flows. 

“These outflows reflected the reversal of non-resident portfolio investments due to adverse sentiment arising from the moderating growth momentum in a number of major and emerging economies, the uncertainty surrounding commodity prices as well as the possible disorderly market conditions arising from policy adjustments in major economies,” it said. 

BNM added that continued direct investment abroad by Malaysian companies and the acquisition of foreign portfolio assets by resident institutional investors during the year also contributed to the outflows. 

It pointed out the international reserves were ample to facilitate international transactions. 

As at Dec 31, 2015, the reserves were sufficient to finance 8.5 months of retained imports, significantly higher than the three-month international threshold. 

BNM also noted the reserves level was also adequate to meet external obligations with a reserves to short-term external debt coverage of 1.1 times. 

“It is important to note that not all short-term external debt creates an immediate claim on reserves given the external assets and export earnings of borrowers,” it added.