Financial market volatility to persist in near term, says Bank Negara

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PETALING JAYA: Financial market volatility is expected to remain elevated in the near term as a resumption in the rise of Covid-19 infections in sever...

Bank Negara says investor sentiment could turn more cautious on weaker-than-expected corporate earnings and an escalation of trade tensions. – AFPPIXFinancial market volatility is expected to remain elevated in the near term as a resumption in the rise of Covid-19 infections in several countries will continue to weigh on financial markets and heighten trading swings.

“Policy interventions by BNM served to maintain orderly conditions within the foreign exchange, bond, and money markets during this period, with conditions largely normalising by the end of H1’20,” it said. Of note, retail investors drove trading value and volume on the local bourse, overtaking domestic institutional investors, although more recent profit-taking activity since August has led to some price correction.

Cumulative NR outflows which peaked in April 2020 have since reversed to record a RM4.3 billion net inflow until end-August 2020 amid the gradual improvement in global investor sentiment and a continued stable base of NR investors in the domestic bond market.

 

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