Friday, 25 February 2011 at 12:50, Bloomberg
Malaysia’s central bank sold 3.5 billion ringgit ($1.1 billion) of seven-year Islamic bonds at a higher average yield of 3.872 percent.
The monetary authority, which conducts auctions on behalf of the Treasury, last sold conventional notes of similar maturity on Oct. 14 at 3.539 percent. Investors submitted bids for 2.42 times the amount of August 2018 notes on sale, compared with 2.69 times at the previous sale, according to Bank Negara Malaysia’s website.
The higher yield “takes into account that the government- bond supply is going to be very large this year,” said Tan Chee Wee, head of fixed-income research at Maybank Investment Bank Bhd. in Kuala Lumpur.
The yield on the 4.012 per cent bonds due September 2017 was unchanged at 3.74 per cent as of 2:47Pm in Kuala Lumpur, according to Bursa Malaysia.
The finance ministry forecasts a 45.5 billion ringgit shortfall in its budget this year versus 43.3 billion ringgit in 2010. Malaysia raised 60.5 billion ringgit from domestic bond sales last year, compared with 93.5 billion ringgit in 2009, according to data from the central bank.
The ringgit has advanced 0.4 per cent this year. Local- currency Shariah-compliant government bonds have returned 0.2 per cent so far in 2011, according to the Bloomberg AIBIM Bursa Malaysia Sovereign Shariah Index.
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