BNM eases hedging restrictions and corporates win

Stephen Innes, a senior currency trader and analyst at Oanda in Singapore, noted bond market outflows had been “massive” following last year’s move to slash the offshore NDF market. And he suspects the central bank saw the “writing on the wall”
when it saw a staggering level of flows out of  MGS (Malaysian government securities) last month, and it was clear that the central bank “needed to implement some changes”.

Foreigners dumped a record RM26.2 billion of local bonds in March, bringing down the total foreign ownership to 38.5% from about 47% in November 2016, Malaysian newspaper the Star reported on April 15
However, “increasing their effective hedges to 100% in one go was much better than anyone had expected Innes said, adding it signalled the BNM’s willingness to implement further market changes.
Corporate Treasurer

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Stephen Innes

Stephen Innes

Head of Trading APAC at OANDA
Stephen has over 25 years of experience in the financial markets and currently based in Singapore as the Head of Trading Asia Pacific with OANDA. Stephen's market views focus on the movement of G-10 and ASEAN Currencies. His views appear in Bloomberg, CNBC.Reuters, New York Times WSJ and the Economist. His media appearances include Bloomberg TV & Radio, BBC International, Sky TV, Channel News Asia, ASTRO AWANI and BFM Malaysia. Stephen has an extensive trading experience in Spot and Forward FX, Currency and Interest Rate Futures, Money Market Derivatives and Precious Metals. Before joining OANDA, he worked with organisations like Nat West, Chemical Bank, Garvin Guy Butler, and Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.
Stephen Innes