Fixed Income Daily Pulse, 30 March 2016

Today’s trade recap by our trading desk:-
·         The market sprung back to action as there were quite strong buying momentum on both MGS and GII papers as market reacted to Yellen's dovish speech last night. USD/MYR dropped by more than 600 pips today. Today BNM conducted the auction for MGS maturing June 2031 which will replace to the previous 15y benchmark MGS. The auction garnered quite decent bid-to-cover ratio at 2.37 times with average yield of 4.201%. There were strong foreign inflows after auction result came out. Furthermore, there were news on Zeti's confidence to achieve the GDP target of 4-4.5% and also 1MDB to repay RM 6 Billion of debt within next 3 weeks which boosted up market confidence.
Malaysia Government Bonds Benchmark Issues MGS Closing Level (%) Change (bp) Volume (RM m) 3-yr 3.245 -2.0 514 5-yr 3.410 -1.0 6 7-yr 3.720 -2.0 240 10-yr 3.830 -3.0 778 15-yr 4.170 -8.0 704 20-yr 4.360 -1.5 - 30-yr 4.710 -1.5 385 Source: BondStream, AmBank	Interest Rate Swap Closing Rates IRS Closing Yield (%) Change (bp) 1-yr 3.595 -3.0 3-yr 3.620 -2.0 5-yr 3.685 -5.5 7-yr 3.825 -4.5 10-yr 4.020 -4.0 Source: Bloomberg, AmBank
Local News:
·         None.