KUALA LUMPUR: Malaysian financial markets have remained resilient amid the current period of global uncertainty but remain mindful of the risks posed by a prolonged geopolitical conflict, according to the Financial Markets Committee (FMC).
The FMC said inflows from exporters as well as foreign direct investment (FDI) have helped offset outflows from domestic importers.
"In the (FMC) meeting (convened on Tuesday), Bank Negara Malaysia (BNM) stated that it will continue to closely monitor developments in the financial markets and reaffirmed its commitment to ensuring orderly market conditions,” it said in a statement today.
The FMC comprises representatives from BNM, financial institutions, corporations, financial service providers and other institutions with a prominent role or participation in the financial markets.
In the statement, the committee also highlighted that the ringgit has ranked among the top regional performers against the US dollar since the last FMC meeting in October 2025, supported by robust portfolio and FDI inflows, strong domestic economic performance, and the government’s continued commitment to fiscal consolidation.
Accordingly, the FMC said, positive investor sentiment and the ringgit’s strength are expected to be sustained into 2026.
The committee also noted ongoing developments in global financial markets, particularly the recent escalation of the conflict in West Asia.
"While uncertainties have risen over developments surrounding tariffs and the length and severity of the conflict, domestic financial markets remain relatively resilient against global volatility,” it said.
Since end-February, the ringgit depreciated by 1.8 per cent against the US dollar during the period, driven by broad-based US dollar strength amid safe-haven demand.
"However, on a year-to-date (YTD) basis (as of March 9), the ringgit’s performance remains positive with an appreciation of 2.5 per cent.
"(Since end-February,) the benchmark 10-year Malaysian Government Securities (MGS) yield rose 11 basis points (bps), broadly in line with the increase in global bond yields, but remained near historic lows. Meanwhile, the FTSE Bursa Malaysia KLCI declined 2.5 per cent but remained relatively stable, indicating resilience in the domestic equity market,” it said.
The FMC said the onshore foreign exchange market continues to record robust activity, with average daily trading volume at US$21.4 billion compared with the 2025 average of US$19.8 billion.
Meanwhile, it said, demand for government bonds remains healthy, with MGS yields relatively anchored, supported by both domestic and non-resident investors.
Non-resident holdings of MGS have increased by RM920 million YTD and remain stable at 21.2 per cent.
Similarly, the domestic equity market has also attracted RM1.5 billion of non-resident inflows YTD, the committee said. - Bernama
