EM Asia Under Pressure

The Malaysian currency led weekly losses in emerging Asia

with a 2.9 percent slump against the greenback so far this week.

That would be the largest weekly depreciation since late

September last year.

“A dangerous combination of extremes is likely amplifying

movements, as volatility expectations remain elevated, yet

liquidity is extremely weak,” said Stephen Innes, senior FX

trader for FX broker OANDA in Singapore.

“The fire alarm is sounding and I expect a mad dash for the

exits if we break the critical support 4.40-42 levels.”

Malaysia’s central bank demanded foreign banks sign

commitments to stop trading the currency in offshore markets,

Reuters reported on Wednesday, a move the broader market views

as a form of capital controls.

Reuters

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Stephen Innes

Stephen Innes

Senior Currency Trader and Analyst at OANDA
Stephen has over 25 years of experience in the financial markets and specializes in Asian currencies at OANDA. After having started his trading career with NatWest Bank, he is currently based in Singapore as a Senior Currency Trader and Analyst with OANDA, focusing on the movement of the Aussie Dollar and ASEAN Currencies. Stephen has an extensive trading experience in Interest Rate Futures, Money Markets and Precious Metals. Prior to joining OANDA, he worked with organizations like Cambridge Mercantile, Nat West, Garvin Guy Butler, Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.
Stephen Innes
Stephen Innes

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