Ringgit Sentiment Continues to Sour

The ringgit fell as much as 0.5 percent to the lowest in more than 13 months after Bank Negara Malaysia warned foreign banks this month against using offshore forwards to bet against the currency. A three-day rally in Brent crude offered limited support for the ringgit even as it boosted prospects for Malaysia’s oil-export earnings.

“The Malaysian ringgit’s in a world of its own simply because of the currency regulations that Bank Negara Malaysia’s coming out with,” said Stephen Innes, a senior trader at Oanda Asia Pacific Pte Ltd. in Singapore. “Right now, people are still looking for the exits on the bond market simply because there’s a growing fear that they just can’t hedge their risk.”

The 10-year yield rose three basis points to end at 4.40 percent, the highest for a similar-maturity benchmark since August 2015. The ringgit reached 4.4420 per dollar, the weakest since Oct. 2, 2015, before trading 0.1 percent higher at 4.4175 as of 5:44 p.m. in Kuala Lumpur. One-month non-deliverable forwards rose 0.1 percent to 4.4250.

Bloomberg

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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