Malaysia’s ringgit rose the most in two weeks, leading gains in Asia, on speculation the U.S. government shutdown will delay the tapering of stimulus that has fueled emerging-market gains.
House Speaker John Boehner said yesterday President Barack Obama refused to negotiate at a meeting with top congressional leaders about the shutdown. The administration is in partial closure after lawmakers failed to agree on a budget. Global funds held 28 percent of Malaysian sovereign bonds in August, compared with 31 percent for Indonesian notes and 17 percent for Thai securities, according to official data.
“The lack of agreement on the fiscal front led to the market thinking that it will mean the third round of quantitative easing will be sustained for a bit longer,” said Nizam Idris, head of fixed income and currency strategy at Macquarie Bank Ltd. in Singapore. “There’s a lot of foreign demand for Malaysian government bonds.”
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