AGN Evening Update | April 7, 2025

Foreign Funds Exit Asia, Trump Wavers as Markets Tumble, and Japan Battles Rice Price Surge

As global economic tensions intensify, today’s AGN Evening Update brings you critical developments across Asia, the United States, and global markets.

Foreign Investors Pull RM31.68 Billion from Asian Markets

Foreign investors reversed a brief buying trend last week, pulling out a staggering US$7.12 billion (RM31.68 billion) across eight key Asian markets. The sharp selloff was detailed in MIDF Amanah Investment Bank Bhd’s latest Fund Flow Report for the week ending April 4, 2025.

• South Korea faced the steepest losses, with a net outflow of US$4.44 billion, largely triggered by political instability following the Constitutional Court’s impeachment of President Yoon Suk Yeol and escalating US tariff threats.
• India recorded US$1.21 billion in foreign outflows, driven by a newly announced 27% US tariff on Indian goods, effective April 9.
• Taiwan, Vietnam, and Thailand also experienced sustained foreign withdrawals, influenced by reciprocal tariff announcements ranging between 32% to 46%.

In Malaysia, Bursa Malaysia saw a net foreign outflow of RM426.6 million, marking the 24th consecutive week of selling. However, local institutional investors remained net buyers, absorbing much of the outflow. Retail investors also returned to net buying, helping stabilize market activity post-Hari Raya holidays.

Trump Opens Door to Talks Amid Global Market Turmoil

Following a week of plunging stock markets, US President Donald Trump signaled on Sunday that he is “open to talking” with global leaders about new trade deals. The announcement comes amid growing backlash over his administration’s sweeping tariff policy targeting 185 countries and territories.

• The Dow Jones and S&P 500 both fell more than 5% on Friday, causing widespread concern about the possibility of a recession.
• Conflicting messages from Trump’s Cabinet have deepened market anxiety. While Commerce Secretary Howard Lutnick insists the tariffs are permanent, Agriculture Secretary Brooke Rollins referred to them as potential negotiation leverage.
• Several Republican senators have backed a bipartisan bill requiring Congressional approval for new tariffs, reflecting growing unease over economic fallout.

Despite public concern, Trump remains defiant, calling the trade war an “economic revolution” and urging Americans to “hang tough.”

Japan Releases National Rice Reserves to Stabilize Prices

Facing its worst rice price surge in over a decade, Japan has begun releasing 210,000 tons from its strategic national rice reserve.

• The average cost of a 60-kilogram bag of rice has jumped 55% over the past two years, sparking panic-buying and consumer anxiety.
• The first batch of 150,000 tons from the reserve has already reached supermarkets, but consumer skepticism remains high, with concerns over grain quality and freshness.
• Minister of Agriculture Taku Eto reassured the public that the supply chain—not supply volume—is the core issue, and prices are expected to stabilize soon.

Rice is a staple of the Japanese diet and central to its food culture, making its price and availability politically sensitive. Similar strategic reserves exist in other Asian economies like India, Vietnam, China, and Thailand to buffer against food inflation.

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