Malaysia Economic News

[BlueKelah]

The daily average trading value of KLCI is around RM1.9 billion (based on AR 2013). The RM20 billion injection, should be significant enough, to create an impact...

Malaysian PM Najib announces $6.6 billion boost for stock market

KUALA LUMPUR (Sept 14): The Malaysian government will inject RM20 billion ($6.6 billion) into a state equity investment firm to shore up the stock market, Prime Minister Najib Razak said on Monday, in a bid to boost confidence in a country reeling from a political scandal.

Datuk Seri Najib told a news conference that the equity investment firm, ValueCap, will invest in undervalued Malaysian companies.
...
http://www.theedgemarkets.com/sg/article...ock-market

Did a quick readup on ValueCap. It is wholly owned by Khazanah Nasional (Msian SWF), KWAP (pension retirement fund) and PNB and its previous mandate was to manage 3rd party funds by attracting mainly shariah funds. It is purely a fund manager.

Sceptics/critics are going to have the usual suspects - (1) Is this going to smoothen the path for 1MDB's proposed IPO (part of najib's rationalization plan)? (2) So who is going to provide the 20bil rm of funds?

Probably from the same place they got the $65billion stimulus money when the GFC hit.

[CityFarmer]

It is partly answering weijian's doubt on the funding? 

I reckon, more will come from other funds...

Malaysia's Khazanah unveils US$1.57 billion in investments to support govt measures

KUALA LUMPUR (Sept 14): Khazanah Nasional Bhd, Malaysia's sovereign wealth fund, announced on Monday additional domestic investments of RM6.77 billion ($2.2 billion) to support the government's economic measures to boost investor sentiment.
...
http://www.theedgemarkets.com/sg/article...t-measures

[greengiraffe]

It is partly answering weijian's doubt on the funding? 

I reckon, more will come from other funds...

Malaysia's Khazanah unveils US$1.57 billion in investments to support govt measures

KUALA LUMPUR (Sept 14): Khazanah Nasional Bhd, Malaysia's sovereign wealth fund, announced on Monday additional domestic investments of RM6.77 billion ($2.2 billion) to support the government's economic measures to boost investor sentiment.
...
http://www.theedgemarkets.com/sg/article...t-measures

Quite simple lah - print $ and Msia will become a banana republic

[CityFarmer]

It is partly answering weijian's doubt on the funding? 

I reckon, more will come from other funds...

Malaysia's Khazanah unveils US$1.57 billion in investments to support govt measures

KUALA LUMPUR (Sept 14): Khazanah Nasional Bhd, Malaysia's sovereign wealth fund, announced on Monday additional domestic investments of RM6.77 billion ($2.2 billion) to support the government's economic measures to boost investor sentiment.
...
http://www.theedgemarkets.com/sg/article...t-measures

Quite simple lah - print $ and Msia will become a banana republic

Not every country can print $ with no worry. M'sia should have sufficient reserve for the RM20 billion injection, IMO

[BlueKelah]

inject to save the stocks which the EPF is invested in lah, otherwise how to maintain a dividend rate of >6% for the EPF in this low interest rate environment?

[weijian]

It is partly answering weijian's doubt on the funding? 

I reckon, more will come from other funds...

Malaysia's Khazanah unveils US$1.57 billion in investments to support govt measures

KUALA LUMPUR (Sept 14): Khazanah Nasional Bhd, Malaysia's sovereign wealth fund, announced on Monday additional domestic investments of RM6.77 billion ($2.2 billion) to support the government's economic measures to boost investor sentiment.
...
http://www.theedgemarkets.com/sg/article...t-measures

Quite simple lah - print $ and Msia will become a banana republic

Not every country can print $ with no worry. M'sia should have sufficient reserve for the RM20 billion injection, IMO

The reserves are purely under the purview of Dr Zeti (Central bank) i suppose and shouldnt become a fiscal tool that Najib is trying to perform. I had read the Khazanah's news and it seems to suggest that these are seperate from the 20bil fund that Najib has directed.

Nonetheless, ValueCap has rich parents - Khazanah, PNB and KWAP (pension fund which had also lent $ to 1MDB's subsidiary) and i suspect part of the bill should come from them. The rest of the bill should be borrowed from private sector with Gov's guarantee/backing? (In Msia, it is very popular to give guarantees...Transport Minister can give guarantee to Port Klang to lose billions or an ex-Home Minister/now DPM can write a letter of support for a supposingly-HK mafia boss)

[opmi]

Malaysian ringgit hits new low of 3.12 against Singapore dollar

At around 11am, the Malaysian ringgit had hit an intra-day low of around 3.1269 from 3.0964, although it recovered slightly to trade around 3.1248 by 12pm.

SINGAPORE: The Malaysian ringgit hit a new low of 3.1248 against the Singapore dollar on Tuesday morning (Sep 29), on renewed concerns over the uncertainties in regional and global economies.

At around 11am, the ringgit had hit an intra-day low of around 3.1269 from 3.0964 on Monday. However, the currency recovered slightly to trade around 3.1248 by 12pm.

The ringgit, which is Asia’s worst performing currency, also hit a new 17-year low of around 4.46 to the US dollar earlier on Tuesday.

Some traders attributed the ringgit's weakness to the continued decline in crude oil prices as this will weigh on the earnings for the region's major net oil exporter.

China's deepening economic slowdown and the probe into 1Malaysia Development Bhd (1MDB) by the US Federal Bureau of Investigation had also worsened sentiment on the ringgit.

Meanwhile, the Singapore dollar touched a six-year low of S$1.4335 against the US dollar on Tuesday morning. It recovered slightly by noon and was trading at 1.4324 against the greenback.

- CNA/xk

[CityFarmer]

Somehow, the statement isn't wrong...

Malaysia can ride out ‘almost perfect storm’, minister says

NEW YORK — Malaysia’s economy and currency are suffering from “an almost perfect storm” due to an outflow of funds from emerging markets, low oil prices and China’s slowdown, the country’s economic planning minister said yesterday (Sept 29).

But he said Malaysia was better placed than in the 1990s Asian financial crisis to ride out hard times.

“A lot of people ask us whether we are going to go back to 1997, 1998,” Mr Abdul Wahid Omar told Reuters in an interview on the sidelines of the UN General Assembly in New York.

“Circumstances are very different between then and now. The circumstances are much better - our fundamentals are much stronger.”
...
http://www.todayonline.com/world/asia/ma...ister-says

[BlueKelah]

Somehow, the statement isn't wrong...

Malaysia can ride out ‘almost perfect storm’, minister says

NEW YORK — Malaysia’s economy and currency are suffering from “an almost perfect storm” due to an outflow of funds from emerging markets, low oil prices and China’s slowdown, the country’s economic planning minister said yesterday (Sept 29).

But he said Malaysia was better placed than in the 1990s Asian financial crisis to ride out hard times.

“A lot of people ask us whether we are going to go back to 1997, 1998,” Mr Abdul Wahid Omar told Reuters in an interview on the sidelines of the UN General Assembly in New York.

“Circumstances are very different between then and now. The circumstances are much better - our fundamentals are much stronger.”
...
http://www.todayonline.com/world/asia/ma...ister-says

somehow it isn't right either..

[piggo]

No return to peg probably because it's no longer affordable... especially with the 'stronger' fundamentals. 

Questionable "proactive" measures like "ValueCap" to support "undervalued" companies... which sounds like fantastic way to funnel more money out.

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