INSIDE MALAYSIA: Ringgit Gains; RBS Advises Caution on Nation
(Bloomberg) -- Ringgit rises as less hawkish-than-expected Fed minutes spur broad dollar weakness.
- Ringgit advances 0.5% to 3.9938 per dollar, while WTI crude oil down 0.2% at $46.68/bbl
- USD/MYR pivoting around 100-DMA at 4.0121; resistance at 50- DMA of 4.0368, Aug. 8 high of 4.0498 and Aug. 3 high of 4.0763; support at Aug. 17 low of 3.9810, July 19 low of 3.9725 and 3.9682, 76.4% Fibo retracement of July 15 to July 25 rally
- RBS advises caution on Malaysia, Asia economist Vaninder Singh writes in a note yday; says nation’s banking system is set to face a “classical” squeeze, with negative deposit growth and still rising loan growth; adds sharp readjustment can’t be ruled out
- For bonds, however, Malaysia’s are offering better yields than U.S. Treasuries on a FX-hedged basis
- Sees USD/MYR at 4 in 3Q and at 4.05 by year-end
- Yield on 3.9% govt bond due Nov. 2026 down 1 bp at 3.491%, according to Bursa Malaysia prices
Alert:
HALISTER1Source: BFW (Bloomberg First Word)
People Vaninder Singh (Royal Bank of Scotland Group PLC)
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