PETALING JAYA: Foreign investors turned net buyers of Malaysian Government Securities (MGS) and Government Investment Issue (GII) in November to RM1.2bil after two consecutive months of net selling, says RAM Rating Services Bhd.
In a statement, it said this was due to the less hawkish messaging put out by the Federal Reserve in early November, which had reignited interest in local currency emerging market bonds last month.
“However, this was offset by the outflow from Malaysian Treasury Bills and Malaysian Islamic Treasury Bills of RM2.5bil, which could be attributed to foreign investors’ inability to roll over funds into fresh papers,” it said, as reported by Bernama.
For 2023, the rating agency projects the issuance of MGS and GII to rise to RM170bil to RM180bil, taking into account the government’s larger deficit financing requirement as well as the refinancing of debts maturing next year.
The rating agency forecast the issuance of MGS and GII to reach RM165bil to RM175bil in 2022, up from RM163.9bil in 2021.
It said in November 2022, MGS and GII issuance stayed robust at RM15bil.
This brought the total issuance in the first 11 months of 2022 to RM163bil, which is on track to meet its forecast of RM165bil to RM175bil for the year.
On corporate bond issuance, RAM Ratings projects it to reach between RM120bil and RM130bil next year.
This will be propelled by private refinancing initiatives, continued infrastructure financing needs and financial institutions’ capital augmentation plans.
