Ringgit heads for best week since March on oil

KUALA LUMPUR (Jan 11): Ringgit is set for its biggest weekly gain since March as a rally in crude prices eases concern about Malaysia’s fiscal position. November industrial production data is due at noon.

* USD/MYR has dropped 1% this week to 4.0957; falls 0.1% Friday

** Support 4.0900, 4.0677, 4.0645; resistance 4.1531, 4.2020, 4.2437

** Brent has jumped 7.3% this week

* Ringgit has benefited from improving global sentiment and the next support level is 4.06 per dollar, says Khoon Goh, head of research at Australia & New Zealand Banking Group in Singapore

** Asian FX have been buoyed by a patient Fed and improving US-China relations, and there’s scope for further gains if the US partial government shutdown starts to undermine the dollar

* 10-year government bond yield little changed Thursday at 4.09%

* The government will auction RM3.5 billion of 2026 bonds on Jan 14

** OCBC Bank forecasts Malaysia’s 10-year yield will rise to 4.24% this year, and sees Bank Negara Malaysia maintaining policy through 2019, according to a note Thursday

* The government will name bankers next week to arrange a ¥200 billion Samurai bond sale: Finance Minister Lim Guan Eng

* Lim also says Malaysia is on track to achieve fiscal deficit of 3.7% of GDP for 2018, 3.4% for 2019

* Industrial production rose 2.3% in November year-on-year vs +4.2% in October: Bloomberg survey before Friday’s data

* The government doesn’t have documents that show China had meetings with previous administration in 2016 to offer help in bailing out state fund 1MDB, Prime Minister Tun Dr Mahathir Mohamad said Thursday

Source: TheEdgeMarkets