Malaysian Bond Outflows May Prove Short-Lived After Rate Cut

Malaysia’s sovereign bond market looks poised to bounce back from recent selling pressure, after a rate cut this week that may fuel bets on further easing.

Bank Negara Malaysia lowered borrowing costs for the first time in five years on Wednesday, calling it a ‘preemptive measure’ in the face of growing risks for the Southeast Asian nation’s economy. The move came after foreign investors sold a net $676 million last month, following three months of inflows, data from BNM show.