Fixed Income Daily Pulse, 03 May 2016

Today’s trade recap by our trading desk:-
·         Rather quiet start to the week after a long weekend as some are still away on holiday. While the local equity market was getting hit, the bond market was well bided with interest seen on the 7Y and 10Y MGS in particular. MYR was also weaker today at 3.93 levels on the back of falling oil prices as well as foreigners selling in the equity market. Yield curve ended the day down by c2bps on the belly with very thin traded volume. There was also the announcement on 15Y GII reopening auction with an issuance of RM2.5bio. WI was last quoted at 4.45-25 with nothing done.
Malaysia Government Bonds Benchmark Issues MGS Closing Level (%) Change (bp) Volume (RM m) 3-yr 3.295 +1.5 139 5-yr 3.450 -2.5 135 7-yr 3.775 - 641 10-yr 3.870 -2.0 321 15-yr 4.170 - 56 20-yr 4.315 +2.5 88 30-yr 4.655 -0.5 1 Source: BondStream, AmBank	Interest Rate Swap Closing Rates IRS Closing Yield (%) Change (bp) 1-yr 3.595 0.0 3-yr 3.570 -1.5 5-yr 3.705 -1.0 7-yr 3.860 0.0 10-yr 4.015 -1.5 Source: Bloomberg, AmBank
Local News:
·         Nikkei Malaysia Manufacturing Purchasing Managers' Index (PMI) fell to 47.1 in April from 48.4 March. New orders declined at the fastest rate in 2016, leading to a sharper decreased in production. On the other hand, manufacturers cut back on input buying as well as employment. International demand also softened in April, with new export orders increasing only slightly.