KUALA LUMPUR, Dec 16 (Bernama) -- Bursa Malaysia extended its positive performance, closing higher for a fourth consecutive session, supported by improving local market sentiment underpinned by a firm domestic macroeconomic backdrop. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 4.59 points, or 0.28 per cent, to 1,648.31, from Monday’s close of 1,643.72. The index had opened 0.95 of a point lower at 1,642.77, and moved between 1,636.50 and 1,648.71 throughout the trading session However, on the broader market, decliners beat gainers 699 versus 408. A further 520 counters were unchanged, 1,149 untraded and 12 suspended. Turnover rose to 2.59 billion units worth RM2.27 billion from 2.50 billion units worth RM2.16 billion on Monday.
Key Takeaways:
BNM reserves reached US$122.7B (Aug 29), the highest in a decade.
Enough to cover 4.8 months of imports and 0.9x short-term external debt.
Ringgit +6% YTD vs USD, supported by stronger reserves and improving sentiment.
Reserves growth led by higher foreign currency assets (US$109.1B).
Stronger Shield Against Shocks
Bank Negara Malaysia (BNM) reported on Tuesday that the country’s foreign exchange reserves rose to US$122.7 billion, a fresh 10-year high. The reserves expanded by about US$700 million in two weeks, underscoring the central bank’s buffer against external volatility and capital outflows.
The build-up comes alongside a firming ringgit, which has gained over 6% against the USD year-to-date, making it one of the better-performing Asian currencies this year.
Healthy Import & Debt Coverage
BNM highlighted that the reserves are sufficient to finance 4.8 months of imports and cover 0.9x the nation’s short-term external debt. Importantly, most short-term borrowings are by domestic banks and multinational corporations for liquidity operations, typically repaid via their own external assets rather than tapping BNM reserves.
This suggests limited risk of sudden drain on official reserves, keeping Malaysia’s external position stable.
Reserve Composition Steady
Foreign currency reserves rose to US$109.1B (from US$108.4B).
IMF reserve position: US$1.3B (unchanged).
Special Drawing Rights (SDRs): US$5.9B.
Gold holdings: US$4.1B.
Other assets: US$2.3B.
The steady composition indicates a stable and diversified reserve structure.
Bottom Line for Investors:
Malaysia’s external resilience continues to strengthen. A 10-year high in forex reserves, coupled with a stronger ringgit, provides a solid buffer against global market volatility and capital outflows. This backdrop supports investor confidence in Malaysian assets, particularly bonds and the currency, amid ongoing global uncertainty.
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