Foreigners trim government debt holdings
Foreigners trimmed their holdings of Malaysian government bonds for a fourth straight month in August, according to data from Malaysia’s central bank.
Their holdings were RM125.51 billion at the end of August, compared with RM125.54 billion at end-July and a peak of RM144.98 billion in April.
Malaysia is among emerging nations that have seen a reduction in foreign holdings of government bonds after chairman Ben Bernanke said in May that the US Federal Reserve intended to start reducing its bond-buying this year.
The lower foreign holdings have been a factor in the weakening of the ringgit. Since Bernanke’s May remarks, the ringgit has shed more than six per cent against the US dollar.
At the end of August, foreign holdings of Bank Negara bills and notes fell to RM55.37 billion from RM58.81 billion in July.
Foreign holdings of government-issued Islamic bonds, or sukuk, fell to RM2.55 billion in August from RM2.71 billion the previous month. Non-Malaysian holdings of private sector debt rose to RM10.08 billion from RM10.03 billion.-- Reuters