The Malaysian financial markets continue to function efficiently with ample liquidity despite recent developments in the country.

Foreign exchange (FX) transaction volume remains healthy at USD14.6 billion supported by two-way flows while the USD/MYR 1-month implied volatility remains within normal range of around 4.0 - 4.5%. USD/MYR opened higher and traded in an orderly manner throughout the day, in line with broad market expectation and consistent with the performance of regional currencies amid the global outbreak of Covid-19. The increased interest led to the USD/MYR interbank FX volume to double from last week’s average.

In the ringgit fixed income market, yield adjustments for the benchmark Malaysian Government Securities have been orderly, with the 5-year and 10-year yield levels recovering from their initial upward movements. The overall secondary bond market recorded a healthy daily trading volume of RM5.9 billion compared to daily average of RM4.7 billion in 2019.

“The orderly manner in which the ringgit FX and bond markets are functioning reflects the maturity of the Malaysian financial markets. There is sufficient liquidity to fulfil all stakeholders’ needs, as reflected in higher transaction volumes concluded. The Financial Market Association of Malaysia (FMAM) and its member institutions are committed to ensuring the effectiveness and efficiency of market operations,” said Chu Kok Wei, President of FMAM.

Financial markets continue to provide efficient intermediation of funds within the economy. The Financial Markets Committee will continue to monitor developments in the financial markets to ensure that all business and transaction needs are met.