Fixed Income Foreign Flows_2 Mar 2015

Mixed Flows – Overall Down

·         Malaysia: In January, the foreign holdings of total debt securities decreased by MYR7.1b to MYR218.8b due to persistent outflows from discount instruments which were net sold MYR8.5b by foreigners during the month. Meanwhile, the foreign holdings of MGS remained resilient netting in MYR1.4b in January but foreigners' share declined to 43.8% from 44.1% due to lower foreign absorption rate

·         Regional: For the countries that we cover for foreign holdings of government bonds, January saw a net USD3.2b inflow almost entirely driven by inflow to Indonesia which received USD3.1b during the month. Indonesia's share of foreign holdings reached a historical high of 40.2% and higher frequency data shows that inflows were sustained in February; if the existing trend continue, Indonesia may stand a chance to surpass Malaysia's MGS with the highest share of foreign holdings in the region