MACRO WATCH Global: Foreign holdings of Malaysian Government Securities (MGS) continued to rise in 2012, amounting to MYR125.3 billion as of October 2012. This accounts for 43.19% of total outstanding MGS in circulation, from 38.7% in January 2012. Malaysian Government Securities constitute the largest component of foreign debt securities holdings, hovering around 60% since early 2012, surpassing foreign holdings in Bank Negara (central bank) bills as foreign holdings in private debt securities and Bank Negara negotiable notes declined. As of October 2012, Malaysian Government Securities holdings constituted 56.47% of total debt securities holdings.
Chart provided by: CEIC
Uncertainties in the global economy have raised concerns about the rising risk of debt in advanced economies, prompting foreign investors to expand their horizons into investment-grade sovereign debts. This includes MGS, given their lower credit risks relative to corporate bonds.
By Pessie Lim in Malaysia – CEIC Analyst