FW: Fixed Income Daily Pulse - 07 September 2017

 

Good Evening,
Today’s trade recap by our trading desk:-
·         On the back of US Congress extending the debt limit for another 3 months and approving aid for Hurricane Harvey victims, there was slight risk on sentiment and traders were unwinding the risk off trades from a day earlier as UST 10y rose slightly to 2.09% levels. During the day, BNM’s MPC committee also kept OPR rate unchanged at 3.00% as expected while the statement highlighted an expectation of stronger growth than expected for 2017. The local bond space continue is buying momentum today as the USDMYR dropped back to near pre-Trump levels at 4.2100. Buying flows were heavy on stocks with maturities < 1year in tandem with the strengthening MYR. Flows were mainly foreign driven for FX play as 1Y MGS stocks were traded at a low of 2.88%, 12bps below OPR. As yields <1y eased by 13bps, the rest of curve continued its slow move further south, dropping 1-2bps across. Key thing to look out tonight will be the outcome of ECB’s monetary policy meeting tonight; on whether there will be any delay in QE tapering.
Malaysia Government Bonds Benchmark Issues MGS Closing Level (%) Change (bp) Volume (RM m) 3-yr 3.345 -1.0 165 5-yr 3.540 -1.5 10 7-yr 3.810 -2.0 66 10-yr 3.850 -1.5 22 15-yr 4.290 -0.5 1 20-yr 4.485 -2.0 - 30-yr 4.725 - - Source: BondStream, AmBank	Interest Rate Swap Closing Rates IRS Closing Yield (%) Change (bp) 1-yr 3.493 0.2 3-yr 3.615 0.0 5-yr 3.700 0.0 7-yr 3.815 0.5 10-yr 3.940 -1.0 Source: Bloomberg, AmBank