Asian bonds post largest monthly foreign outflow since March 2020
South Korea accounted for about US$6.3 billion of September’s selling as higher global bond yields weighed on investor demand.
Foreign investors withdrew a net US$8.21 billion (RM33.5 billion) from bonds across five Asian markets in September, according to figures from regulators and bond market bodies. The outflow was the largest since March 2020, when net selling reached US$17.28 billion.
The figures cover India, Indonesia, Malaysia, South Korea and Thailand. South Korea recorded about US$6.3 billion in net foreign sales, its highest monthly outflow since US$7.25 billion in March. Thailand registered US$822 million, followed by India at US$548 million, Malaysia at US$436 million and Indonesia at US$100 million.
Regional equities also lost about US$23.49 billion in overseas capital. Khoon Goh, ANZ’s head of Asia research, said selling across both asset classes pointed to greater caution among global investors as Federal Reserve tightening, rising bond yields and elevated oil prices affected risk appetite.
September saw the benchmark US 10-year Treasury yield climb 53.5 basis points, reaching 5.3645%, a 24-1/2-year high. Concerns that expensive oil could drive inflation strengthened expectations for additional interest-rate increases by major central banks.
