Onshore financial markets remain stable, says Financial Markets Committee

  • Banking
  • Tuesday, 15 May 2018

As at 9.26 am(0123 gmt), the local unit was quoted at 3.9250/9280 against the US dollar from 3.9220/9250 recorded at the close on Monday.

KUALA LUMPUR: Malaysia’s onshore financial markets remain stable and orderly when they reopened on Monday after the 14th General Election, says the Financial Markets Committee (FMC).

The FMC said on Tuesday the markets have continued to function in an effective manner, facilitating smooth intermediation activities among market participants. 

“Overall, investors’ sentiments and reactions have been positive,” said the FMC, which was established by Bank Negara Malaysia in May 2016.

The president of the Financial Markets Association of Malaysia Datuk Lee Kok Kwan said since the re-opening of the onshore ringgit market on Monday, the local unit traded close to its last traded price prior to the GE14. Markets were closed on Wednesday to Friday.

The ringgit was hovering around 3.95, after an initial opening of 3.97, signalling continued investor’s confidence on the new Malaysian Government, he said.

As for the onshore forex market, Lee said it remains active, recording a daily average volume of above US$15bil after GE14.

Other key domestic markets including the 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 seven-year Malaysian Government Investment Issue (MGII). 

Financial intermediation continues to be undisrupted backed by ample liquidity in the markets.

“Malaysian economic fundamentals remain strong, reinforced by current account surplus, strong reserves position, low level of external indebtedness and a well-capitalised banking system,” he said.

The FMC will continue to monitor these developments and work with financial market participants to address any further volatility that could emerge from the transition process to ensure orderly functioning of the financial markets.

The FMC comprises representatives from Bank Negara, financial institutions, corporations, financial service providers and other institutions which have prominent role or participation in the financial markets. 
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