FW: FI Research - Reopening of 15-year MGII

 

 

Dear Readers,   Highlights of the report as follow:-

The reopening of the 15-year MGII 06/33 with a size of RM3.5bil, recorded a strong bid-to-cover (BTC) ratio of 2.783 times. Average yield for this MGII is 4.778%, which sits within a slightly higher range as compared to the previous 15-year MGII auction, between 4.768% and 4.794%. At present, we found the 15-year MGII/MGS spread has narrowed down to 13.40bps from its one-year average of 16.66bps (Chart 1). The higher volatility in MGS with a standard deviation of 0.11 compared to the MGII’s 0.09 was largely induced by the external factors i.e. concerns over emerging market debt crisis due to Feds’ aggressive rate hike path added with trade tension. As the investors’ primary focus is whether US and China can avert a full blown trade war, the overall sentiment in both domestic and external front has been rather subdued.  The next tender to watch is the new issuance of the 30-year MGS 07/48. The last auction of such papers was the 30-year MGS in October 2017 which reported a 1.603 times BTC ratio.

 

Best regards,

Fixed Income Research & Strategy

AmBank Research, AmBank (M) Berhad

+603 2036 2255 (DL) +03 2031 7218 (Fax)

Level 15, Bangunan AmBank Group, 55 Jalan Raja Chulan, 50200 Kuala Lumpur

 

 

 

****************************************************************************************************************************************************************************************************************************************************************************************************************

DISCLAIMER:

This message may contain confidential and privileged information for its intended recipient(s) only. If you are not an intended recipient, you are hereby notified that any review, dissemination, and distribution, printing or copying of this message or any part thereof is strictly prohibited. Please delete the entire message and inform the sender of the error. Any opinions, conclusions and other information in this message that are unrelated to official business of AmBank Group are those of the individual sender and shall be understood as neither explicitly given nor endorsed by AmBank Group.

****************************************************************************************************************************************************************************************************************************************************************************************************************