Fixed Income Daily Pulse, 25 May 2016

Today’s trade recap by our trading desk:-
·         Local bond market continued its bearishness as the selling pressure on 7Y and 10Y benchmarks continued in the morning. However, as MYR retraced to close below 4.10, the bond market pared some losses on the belly which saw yields moving back to near yesterday’s close while the front end and back end gained 2-8bps. Traded volume has been very thin on the benchmarks on the back of the recent bearishness while the short ends papers saw bigger volume transacted as offshore accounts began to unwind their carry trades when implied yields went higher.
Malaysia Government Bonds Benchmark Issues MGS Closing Level (%) Change (bp) Volume (RM m) 3-yr 3.285 +4.0 51 5-yr 3.460 +8.0 126 7-yr 3.805 +0.5 283 10-yr 3.905 -1.0 282 15-yr 4.225 +2.0 0 20-yr 4.330 +1.5 0 30-yr 4.705 +3.0 3 Source: BondStream, AmBank	Interest Rate Swap Closing Rates IRS Closing Yield (%) Change (bp) 1-yr 3.610 -0.5 3-yr 3.610 -0.5 5-yr 3.710 0.0 7-yr 3.870 +1.0 10-yr 4.050 +2.0 Source: Bloomberg, AmBank
Local News:
·         None.