MONTHLY REVIEW: RISK-ON MARKET AGAINST CAUTIOUS CENTRAL BANKS - NOVEMBER 2023 - FULL REPORT
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| Report ID |
60538900469626 |
Popularity |
366 views 23 downloads |
| Report Date |
Dec 2023 |
Product |
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| Company / Issuer |
Fixed Income Bond Market Update |
Sector |
Bond Market Update - Bond Market Update |
| Price (RM) |
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| Rationale |
Summary
- Malaysia posted a firmer gross domestic product (GDP) print of 3.3% in 3Q2023 (2Q2023: 2.9%) in line with the advanced estimate, bolstered by private consumption which grew at a faster pace. The latest October trade data showed some nascent signs of recovery in the external sector, supported by an anticipated recovery in the Chinese economy and global semiconductor market.
- The ringgit displayed signs of improvement against the greenback as the broad dollar weakness is driven by prospects of a potential conclusion to the US rate tightening cycle.
- Uncertainties over the Middle East conflict and mixed outcomes in upcoming inflation indicators from advanced economies could heighten market volatility.
- The upward momentum in US Treasury (UST) yields since July has reversed, with lower long-end yields, even after a brief uptick following the US credit rating outlook downgrade. The reversal should support the local bond market along with the anticipated improvement in foreign flows.
- Central banks in advanced economies remained cautious in concluding their tightening cycle due to persistent inflation concerns. Despite the Federal Reserve’s (Fed) pause decision, risk-on sentiment has surged with expectations for an end of the rate hike cycle in 2024 as key inflation and employment data came in cooler than expected.
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