Move to hold rates may attract foreign inflows into Malaysia

Dass: Our forecast for the three-year, five-year and 10-year MGS is at 2.8%, 3%, and 3.3% with room for yields to test lower.

PETALING JAYA: The move to hold the key benchmark rate unchanged may attract foreign capital flows into Malaysian bonds but much will be dictated by external headwinds after the latest data showed lower foreign holdings of local bonds.

Economists and bond analysts concurred that global monetary easing would see capital flows into emerging markets, including Malaysia, as investors seek higher yields across regional markets. They agreed that the global environment and local developments in the market may impact foreign holdings of Malaysian bonds, particularly the Malaysian Government Securities (MGS).