The purpose of a detailed breakdown of international reserves is to provide forward looking information not only on the size of reserves but the type and usability of reserves, and the future and potential inflows and outflows of foreign exchange over the next 12 month period. This would enhance the assessment of vulnerabilities and foreign exchange risk exposure.
Outflows are mainly for external debt servicing.
Since not all inflows have been included, Table II currently shows a smaller net inflow. It also shows that Bank Negara Malaysia does not engage in forward transactions, except for a small amount. Malaysia does not have any undrawn, unconditional credit lines provided by or to other central banks, international organisations, banks, and other financial institutions. The amount of foreign currency assets which are not claims on non-residents is minimal. The projection of future known short-term net drains on reserves is a net inflow of foreign currency assets in the next 12 months due to returns from high reserves and small external debt repayment.