KUALA LUMPUR (May 6): Domestic financial markets remain resilient and continue to intermediate effectively despite external volatility, Bank Negara Malaysia’s (BNM) Financial Markets Committee said on Tuesday.

While the outlook remains uncertain and subject to the outcome of ongoing trade negotiations, the Malaysian financial markets have remained orderly, according to a statement issued following the committee’s meeting on April 28.

“This allows us to focus our efforts on market development initiatives that will further enhance investors’ experience in our markets,” said BNM Deputy Governor Adnan Zaylani Mohamad Zahid, who also chairs the committee. “Nonetheless, we remain vigilant amid the rapidly evolving global situation.”

The ringgit has appreciated by 2.3% year-to-date against the US dollar along with most regional currencies, driven primarily by broad dollar weakness. The FBM KLCI has climbed more than 10% from its low on April 9, and the benchmark index is currently at its highest since March 10.

The committee, set up in 2016 to broaden industry engagement, includes representatives from BNM, the Securities Commission Malaysia, and financial institutions, including insurers and fund managers.

The domestic foreign exchange market liquidity remains high with an average daily turnover of US$18.8 billion year-to-date, growing at a “healthy” year-on-year clip of 6.8%, allowing domestic corporates to meet their foreign exchange needs, the committee noted.

“Members also observed growing interest in using local currencies for the settlement of cross-border trade and investment transactions,” it added.