Fixed Income Foreign Flows, Feb 17: Outflows, likely maturity driven

·         Fund flows to emerging market debts rose to a net gain of +USD17.1b in February from +USD14.1b in January, the IIF estimates.

·         On Malaysia, foreign outflows widened to MYR7.3b but it was mostly maturity-driven. Majority of the outflows since Nov 2016 was due to selloff by foreign banks.

·         But the risks is whether bond index provider arbitrarily reduces Malaysia’s weight in GBI-EM GD which has been on the decline in the past few months.

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