Central Bank of Malaysia: Monthly Highlights - January 2018

Transcription

1. Monthly Highlights January 2018 Inflation moderated in January 2018 Contribution to Inflation • Headline inflation moderated to 2.7% in January due mainly to lower transport inflation at 5.7% (December 2017: 11.5%). p.p.t contribution Jan 18 2.7% Dec 17 3.5% Jan-18 Dec-17 Oct-17 Nov-17 Sep-17 Jul-17 Aug-17 Jun-17 Apr-17 May-17 Jan-17 Feb-17 6 5 4 3 2 1 0 -1 -2 -3 -4 Mar-17 %, yoy 6 5 4 3 2 1 0 Others (56.1%) -1 Transport (13.7%) -2 Food and non-alcoholic beverages (30.2%) -3 Headline Inflation -4 – Although RON95 petrol averaged slightly higher at RM2.28 per litre in January 2018 (December 2017: RM2.27 per litre), the higher base of RON95 price in January 2017 (RM2.10 per litre) compared to December 2016 (RM 1.90 per litre) resulted in lower inflation in the transport category. • Food inflation was also lower at 3.8% (December: 4.1%) reflecting lower inflation in the fish and seafood category. Source: Department of Statistics, Malaysia and staff estimates Higher current account surplus in 4Q 2017 Malaysia’s Current Account Balance Secondary Income Primary Income % of GNI Services Goods 6 Current Account Balance (RHS) 4 RM billion 45 30 4Q 17 RM12.9 bn 2 15 0 0 -2 3Q 17 RM12.5 bn • Going forward, the current account surplus is expected to continue registering a healthy surplus, supported mainly by the goods account. 4Q-17 3Q-17 2Q-17 1Q-17 4Q-16 3Q-16 2Q-16 1Q-16 4Q-15 3Q-15 2Q-15 -6 1Q-15 -4 -30 4Q-14 -15 • The current account surplus widened, reflecting a larger goods surplus and lower secondary income deficit. Source: Department of Statistics, Malaysia Net financing growth continued to support economic activity Net Financing through Banking System Loans and Corporate Bonds %, yoy Banking System Loans Corporate Bonds Net Financing 20 Jan 18 7.2% 15 10 5 Dec 17 6.9% Jan-18 Dec-17 Nov-17 Oct-17 Sep-17 Aug-17 Jul-17 Jun-17 May-17 Apr-17 Mar-17 Jan-17 Feb-17 0 1 Net financing refers to loans extended by the banking system (excluding development financial institutions (DFIs)) and corporate bonds. Source: Bank Negara Malaysia • Net financing1 growth increased to 7.2% in January 2018 (December 2017: 6.9%). The growth of net outstanding issuances of corporate bonds continued to increase, with a double-digit growth rate of 16.6% (December 2017: 15.4%). The growth of outstanding loans of the banking system also increased slightly to 4.2% (December 2017: 4.1%). • The growth of outstanding business loans increased to 2.0% in January 2018 (December 2017: 1.8%), driven mainly by wholesale and retail trade, restaurants and hotels; real estate; construction; and primary agriculture sectors. 1
2. Monthly Highlights January 2018 Banking system capitalisation remained strong Capital Adequacy Ratios % 18 Jan 18 17.4% Jul 17 83.5% 16 14 Jan 18 13.9% 12 Common Equity Tier 1 Capital Ratio Tier 1 Capital Ratio Total Capital Ratio 10 Jan 18 Nov 17 Jul 17 Sep 17 May 17 Jan 17 Mar 17 Nov 16 Jul 16 Sep 16 May 16 Jan 16 Mar 16 8 • Financial institutions are well-positioned to withstand macroeconomic and financial shocks, with excess capital buffers of RM140 billion as at January 2018. • More than 75% of total capital comprised high quality loss-absorbing capital in the form of Common Equity Tier 1 Capital (i.e. equity, retained earnings and reserves). Jan 18 13.1% Source: Bank Negara Malaysia Financial markets attracted non-resident inflows amid positive sentiments Non-Resident Portfolio Flows by Instrument RM billion BNM bills Government bonds 10 Corporate bonds Equity • In January, the domestic financial markets were supported by positive sentiments, driven by Malaysia’s strong economic outlook and higher global oil prices. • As a result, the MGS and equity markets attracted non-resident inflows amounting to RM4.2 billion and RM3.4 billion, respectively. 8 6 4 • Following the inflows, the ringgit appreciated by 4.3% against the US dollar and the FBM KLCI increased by 4.0% in January. 2 0 -2 -4 Jan-18 Dec-17 Nov-17 Oct-17 Sep-17 Aug-17 Jul-17 -6 Note: Government bonds include Malaysian Government Securities (MGS), Government Investment Issues (GII) and Sukuk Perumahan Kerajaan (SPK) Source: Bank Negara Malaysia, Bursa Malaysia • In the bond market, 3-year, 5-year and 10-year MGS yields increased by 5 basis points each, following the increase in the OPR by 25 basis points. The impact of the OPR increase on MGS yields was mitigated by non-resident inflows into the MGS market. • FX swap volumes increased by USD11.3 billion to USD112.1 billion, contributed mainly by the portfolio investments hedging activities of nonresidents. An improvement in dollar liquidity conditions due to higher inflows during the month resulted in a lower 1-month implied dollar funding cost via FX swaps to 1.76% as at end-January (end-December: 2.16%). In addition, the average 1-month USD/MYR swap points increased by 14 points to 50 points during the month factoring in the OPR increase. 2
3. SIARAN AKHBAR Ref . No.: 02/18/09 EMBARGO: Not for publication or broadcast before 1500 hours on Wednesday, 28 February 2018 MONTHLY HIGHLIGHTS – JANUARY 2018 Inflation moderated in January 2018 • Headline inflation moderated to 2.7% in January due mainly to lower transport inflation at 5.7% (December 2017: 11.5%). - Although RON95 petrol averaged slightly higher at RM2.28 per litre in January 2018 (December 2017: RM2.27 per litre), the higher base of RON95 price in January 2017 (RM2.10 per litre) compared to December 2016 (RM 1.90 per litre) resulted in lower inflation in the transport category. • Food inflation was also lower at 3.8% (December: 4.1%) reflecting lower inflation in the fish and seafood category. Higher current account surplus in 4Q 2017 • The current account surplus widened, reflecting a larger goods surplus and lower secondary income deficit. • Going forward, the current account surplus is expected to continue registering a healthy surplus, supported mainly by the goods account. Net financing growth continued to support economic activity • Net financing 1 growth increased to 7.2% in January 2018 (December 2017: 6.9%). The growth of net outstanding issuances of corporate bonds continued to increase, with a double-digit growth rate of 16.6% (December 2017: 15.4%). The growth of outstanding loans of the banking system also increased slightly to 4.2% (December 2017: 4.1%). 1 Net financing refers to loans extended by the banking system (excluding development financial institutions (DFIs)) and corporate bonds.
4. • The growth of outstanding business loans increased to 2.0% in January 2018 (December 2017: 1.8%), driven mainly by wholesale and retail trade, restaurants and hotels; real estate; construction; and primary agriculture sectors. Banking system capitalisation remained strong • Financial institutions are well-positioned to withstand macroeconomic and financial shocks, with excess capital buffers of RM140 billion as at January 2018. • More than 75% of total capital comprised high quality loss-absorbing capital in the form of Common Equity Tier 1 Capital (i.e. equity, retained earnings and reserves). Financial markets attracted non-resident inflows amid positive sentiments • In January, the domestic financial markets were supported by positive sentiments, driven by Malaysia’s strong economic outlook and higher global oil prices. • As a result, the MGS and equity markets attracted non-resident inflows amounting to RM4.2 billion and RM3.4 billion, respectively. • Following the inflows, the ringgit appreciated by 4.3% against the US dollar and the FBM KLCI increased by 4.0% in January. • In the bond market, 3-year, 5-year and 10-year MGS yields increased by 5 basis points each, following the increase in the OPR by 25 basis points. The impact of the OPR increase on MGS yields was mitigated by non-resident inflows into the MGS market. • FX swap volumes increased by USD11.3 billion to USD112.1 billion, contributed mainly by the portfolio investments hedging activities of nonresidents. An improvement in dollar liquidity conditions due to higher inflows during the month resulted in a lower 1-month implied dollar funding cost via FX swaps to 1.76% as at end-January (end-December: 2.16%). In addition, the average 1-month USD/MYR swap points increased by 14 points to 50 points during the month factoring in the OPR increase. Bank Negara Malaysia 28 February 2018 Diterbitkan oleh: Jabatan Komunikasi Strategik, Tingkat 14, Blok B, Bangunan Bank Negara Malaysia, Jalan Dato’ Onn, 50480 Kuala Lumpur, Malaysia. Telefon: +60(3) 2698 8044 Faksimili: +60(3) 2693 6919 W eb: www.bnm.gov.my