Malaysia’s ringgit advanced to a 13-year high on speculation additional US monetary stimulus will weaken the dollar and stoke demand for emerging-market assets.
The ringgit headed for a weekly gain after the Federal Reserve yesterday said it will buy an extra US$600 billion of Treasuries through June to spur growth in the world’s biggest economy and left unchanged its pledge to keep interest rates low for an “extended period.” Appreciation may be restrained after a government report showed Malaysia’s exports grew in September at the slowest pace since November 2009.
“The Fed program reinforces the market expectations for further weakness in the dollar,” said Akira Banno, a treasury adviser at Bank of Tokyo-Mitsubishi UFJ Bhd. in Kuala Lumpur. “This should continue to favor Asian currencies, especially where central banks have been raising rates. The ringgit can gradually appreciate.”
The ringgit traded at 3.083 per dollar as of 8:44 a.m. in Kuala Lumpur, little changed on the day and 1.1 per cent stronger than at the end of last week, according to data compiled by Bloomberg. It earlier touched 3.0780, the highest level since October 1997, and may reach 3.05 by month-end, Banno said. Local financial markets are closed tomorrow for a public holiday.
Global investors bought US$129 million more Malaysian stocks than they sold in September, boosting their share of the local market to a two-year high of 22 per cent, CIMB Investment Bank Bhd said on Oct. 27, citing data compiled by EPFR Global. Overseas funds owned a record RM68 billion (US$22 billion) of government bonds at the end of September, 66 per cent more than at the start of the year, according to central bank figures.
Rate Increase
Bank Negara Malaysia has raised its overnight rate three times this year to 2.75 per cent from 2 per cent, and will hold its final policy meeting of the year on November 12. China, Australia and India have all increased borrowing costs in the past month.
Malaysia’s exports grew 6.9 per cent in September from a year earlier following a 10.6 per cent increase in August, the trade ministry said after the close of local-market trading yesterday. Growth in shipments has decelerated every month since March.
The nation’s benchmark 10-year bonds rose yesterday by the most in three weeks, bringing yields down from near their highest level since July. They haven’t traded today.
The yield on the 4.378 per cent note due November 2019 was 3.90 per cent, according to Bursa Malaysia. The yield has declined three basis points, or 0.03 percentage point, from October 29.
The treasury is scheduled to auction Syariah-compliant notes maturity in 2020 later this month. It hasn’t disclosed the date and amount of the offering. -- Bloomberg
The ringgit headed for a weekly gain after the Federal Reserve yesterday said it will buy an extra US$600 billion of Treasuries through June to spur growth in the world’s biggest economy and left unchanged its pledge to keep interest rates low for an “extended period.” Appreciation may be restrained after a government report showed Malaysia’s exports grew in September at the slowest pace since November 2009.
“The Fed program reinforces the market expectations for further weakness in the dollar,” said Akira Banno, a treasury adviser at Bank of Tokyo-Mitsubishi UFJ Bhd. in Kuala Lumpur. “This should continue to favor Asian currencies, especially where central banks have been raising rates. The ringgit can gradually appreciate.”
The ringgit traded at 3.083 per dollar as of 8:44 a.m. in Kuala Lumpur, little changed on the day and 1.1 per cent stronger than at the end of last week, according to data compiled by Bloomberg. It earlier touched 3.0780, the highest level since October 1997, and may reach 3.05 by month-end, Banno said. Local financial markets are closed tomorrow for a public holiday.
Rate Increase
Bank Negara Malaysia has raised its overnight rate three times this year to 2.75 per cent from 2 per cent, and will hold its final policy meeting of the year on November 12. China, Australia and India have all increased borrowing costs in the past month.
Malaysia’s exports grew 6.9 per cent in September from a year earlier following a 10.6 per cent increase in August, the trade ministry said after the close of local-market trading yesterday. Growth in shipments has decelerated every month since March.
The nation’s benchmark 10-year bonds rose yesterday by the most in three weeks, bringing yields down from near their highest level since July. They haven’t traded today.
The yield on the 4.378 per cent note due November 2019 was 3.90 per cent, according to Bursa Malaysia. The yield has declined three basis points, or 0.03 percentage point, from October 29.
The treasury is scheduled to auction Syariah-compliant notes maturity in 2020 later this month. It hasn’t disclosed the date and amount of the offering. -- Bloomberg
i wish USD will be stronger today..currently US index is hitting weekly lower trendline. hope it will bounce up from here..
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