Bloomberg News

Ringgit Halts Rally on Concern Malaysia’s Economy Is Slowing

March 09, 2012

The ringgit halted a two-week rally on concern Europe’s sovereign-debt crisis is slowing Southeast Asia’s third-biggest economy.

The central bank will leave borrowing costs on hold when it reviews monetary policy today, economists predicted, after government data showed this week exports rose the least in 15 months in January. The Bloomberg-JPMorgan Asia Dollar Index halted a two-day advance as Greece completed its debt swap.

“We think there’ll be no interest-rate cuts for the rest of the year,” said Saktiandi Supaat, the Singapore-based head of foreign-exchange research at Malayan Banking Bhd.

The ringgit was at 3.0070 per dollar as of 4:34 p.m. in Kuala Lumpur, compared with 3.0038 on March 2 and yesterday, according to data compiled by Bloomberg. One-month implied volatility, a measure of price swings that options traders use, held steady at 7.40 percent.

Bank Negara Malaysia will leave its benchmark overnight rate at 3 percent, according to 19 of 20 economists surveyed by Bloomberg News. One predicted a 25-basis point cut.

Five-year government bonds were little changed for the week. The yield on the 4.262 percent notes due September 2016 was 3.24 percent, according to Bursa Malaysia. The rate rose one basis point, or 0.01 percentage point, today.

To contact the reporter on this story: Liau Y-Sing in Kuala Lumpur at yliau@bloomberg.net

To contact the editor responsible for this story: Sandy Hendry in Hong Kong at shendry@bloomberg.net.


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