Fund manager as saying financial institutions could face challenges in issuing ringgit bonds, as they were difficult to trade outside the government bond market.

Additionally, the dollar-ringgit swap market had increased in volatility in the past few weeks with a 100 basis-point shift.

The local bond market had seen an influx of foreign issuers in the past few months, but it had since cooled off, mainly due to rising inflation, challenging global economic landscapes and political uncertainties.

Analysts said bond yields had continued to increase, on expectations that interest rates would rise to curb inflationary pressures, which would cause bond prices to fall.