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Exchange Rates for RM
- Thread starter crystal_tiong
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Malaysia's task to support the ringgit just became a lot harder
PUBLISHED ON FEB 27, 2015 9:47 AM
KUALA LUMPUR (Bloomberg) - Malaysia's task in propping up Asia's worst-performing currency just got a lot tougher.
The cost of options protecting against further ringgit declines approached a 1 1/2-year high on speculation 1Malaysia Development Bhd., the state investment fund, will need a bailout. The currency is already languishing at its weakest level since 2009 as the oil-exporting nation suffers amid sliding crude prices.
"The market remains wary of 1MDB's ability to repay its debt," Irene Cheung, a foreign-exchange strategist in Singapore at Australia & New Zealand Banking Group, said Feb. 24. "The ringgit is vulnerable to the near-term outlook for oil prices. A recovery is difficult."
A weaker currency is a concern for Malaysia because it pushes up the cost of servicing the second-highest external debt burden among Asia's developing nations. Further losses in the ringgit may hasten an investor exodus from Malaysian assets and hurt the government's efforts to rein in its budget deficit.
The ringgit has tumbled 7 per cent in the past three months, the most among 11 Asian currencies tracked by Bloomberg, and touched a six-year low of 3.6460 to the US dollar on Feb. 23.
That day, a report in Malaysia's Edge newspaper suggested 1MDB may need a RM3 billion (S$1.13 billion) cash injection from the government to service debt, just two weeks after it repaid RM2 billion in overdue loans. The investment fund responded by saying it would seek refinancing "from the best available sources."
"Whilst the 1MDB issues remain unresolved, there could still be a long shadow cast on the ringgit," said Vishnu Varathan, a Singapore-based economist at Mizuho Bank Ltd., a unit of Japan's third-largest lender. The currency also suffers from "general concerns about fiscal risks," he said.
Those concerns are showing up in derivatives prices. The premium on options giving the right to sell the ringgit in three months, over those allowing for purchases, widened to as much as 2.36 percentage points on Feb. 23, risk-reversal data compiled by Bloomberg show.
That's approaching the peak of 2.45 percentage points on Jan. 30, which was the highest since September 2013.
Mizuho cut its year-end ringgit forecast to 3.4 to the dollar on Feb. 4, from 3.35 previously. Strategists have struggled to keep pace with the currency's slide, and the median of 27 estimates in a Bloomberg survey puts it at 3.64 by Dec. 31, just 1.5 per cent weaker than Thursday's level of 3.5840.
HSBC, last year's most-accurate forecaster of the ringgit in Bloomberg Rankings, is more pessimistic after revising its year-end estimate to 3.75 on Jan. 30, from 3.57.
Bank Negara Malaysia Governor Zeti Akhtar Aziz told reporters in Kuala Lumpur on Feb. 24 that the ringgit is "undervalued" and should return to trading in line with economic fundamentals. In a sign the central bank may have intervened to support the currency, foreign-exchange reserves dropped 16 per cent in the past eight months to a four-year low of US$111 billion.
A weaker ringgit makes it more expensive for the country to repay foreign borrowings. Malaysia's proportion of external debt to gross domestic product is 54.6 per cent, the highest among 13 Asian emerging markets tracked by Bloomberg after Sri Lanka and level with Pakistan.
The ringgit started its recent slide in September, when a decline in oil prices gathered pace. Malaysia's currency is particularly vulnerable to the 40 per cent drop in Brent crude since then because of the country's status as the sole net exporter of oil among Asia's major economies. Energy accounts for almost 20 per cent of Malaysia's GDP.
The damage wrought to the economy led Prime Minister Najib Razak to increase the government's 2015 fiscal-deficit target in January to 3.2 per cent of GDP, from 3 per cent. He cut the growth estimate to a range of 4.5 percent to 5.5 per cent, from as much as 6 per cent.
Global funds responded to the drop in the currency by reducing holdings of Malaysian government and corporate debt by more than RM25 billion in November and December, the sharpest drop since mid-2013, according to the most recent data from the central bank.
"It's difficult to say where the support will come from for the ringgit," said Sacha Tihanyi, a Hong Kong-based currency strategist at Scotiabank, which sees the currency tumbling 5 per cent to 3.76 per dollar by year-end. "Most factors are still fundamentally bearish."
- See more at: http://www.straitstimes.com/news/bu...came-lot-harder-20150227#sthash.qUkfoe5U.dpuf
PUBLISHED ON FEB 27, 2015 9:47 AM
KUALA LUMPUR (Bloomberg) - Malaysia's task in propping up Asia's worst-performing currency just got a lot tougher.
The cost of options protecting against further ringgit declines approached a 1 1/2-year high on speculation 1Malaysia Development Bhd., the state investment fund, will need a bailout. The currency is already languishing at its weakest level since 2009 as the oil-exporting nation suffers amid sliding crude prices.
"The market remains wary of 1MDB's ability to repay its debt," Irene Cheung, a foreign-exchange strategist in Singapore at Australia & New Zealand Banking Group, said Feb. 24. "The ringgit is vulnerable to the near-term outlook for oil prices. A recovery is difficult."
A weaker currency is a concern for Malaysia because it pushes up the cost of servicing the second-highest external debt burden among Asia's developing nations. Further losses in the ringgit may hasten an investor exodus from Malaysian assets and hurt the government's efforts to rein in its budget deficit.
The ringgit has tumbled 7 per cent in the past three months, the most among 11 Asian currencies tracked by Bloomberg, and touched a six-year low of 3.6460 to the US dollar on Feb. 23.
That day, a report in Malaysia's Edge newspaper suggested 1MDB may need a RM3 billion (S$1.13 billion) cash injection from the government to service debt, just two weeks after it repaid RM2 billion in overdue loans. The investment fund responded by saying it would seek refinancing "from the best available sources."
"Whilst the 1MDB issues remain unresolved, there could still be a long shadow cast on the ringgit," said Vishnu Varathan, a Singapore-based economist at Mizuho Bank Ltd., a unit of Japan's third-largest lender. The currency also suffers from "general concerns about fiscal risks," he said.
Those concerns are showing up in derivatives prices. The premium on options giving the right to sell the ringgit in three months, over those allowing for purchases, widened to as much as 2.36 percentage points on Feb. 23, risk-reversal data compiled by Bloomberg show.
That's approaching the peak of 2.45 percentage points on Jan. 30, which was the highest since September 2013.
Mizuho cut its year-end ringgit forecast to 3.4 to the dollar on Feb. 4, from 3.35 previously. Strategists have struggled to keep pace with the currency's slide, and the median of 27 estimates in a Bloomberg survey puts it at 3.64 by Dec. 31, just 1.5 per cent weaker than Thursday's level of 3.5840.
HSBC, last year's most-accurate forecaster of the ringgit in Bloomberg Rankings, is more pessimistic after revising its year-end estimate to 3.75 on Jan. 30, from 3.57.
Bank Negara Malaysia Governor Zeti Akhtar Aziz told reporters in Kuala Lumpur on Feb. 24 that the ringgit is "undervalued" and should return to trading in line with economic fundamentals. In a sign the central bank may have intervened to support the currency, foreign-exchange reserves dropped 16 per cent in the past eight months to a four-year low of US$111 billion.
A weaker ringgit makes it more expensive for the country to repay foreign borrowings. Malaysia's proportion of external debt to gross domestic product is 54.6 per cent, the highest among 13 Asian emerging markets tracked by Bloomberg after Sri Lanka and level with Pakistan.
The ringgit started its recent slide in September, when a decline in oil prices gathered pace. Malaysia's currency is particularly vulnerable to the 40 per cent drop in Brent crude since then because of the country's status as the sole net exporter of oil among Asia's major economies. Energy accounts for almost 20 per cent of Malaysia's GDP.
The damage wrought to the economy led Prime Minister Najib Razak to increase the government's 2015 fiscal-deficit target in January to 3.2 per cent of GDP, from 3 per cent. He cut the growth estimate to a range of 4.5 percent to 5.5 per cent, from as much as 6 per cent.
Global funds responded to the drop in the currency by reducing holdings of Malaysian government and corporate debt by more than RM25 billion in November and December, the sharpest drop since mid-2013, according to the most recent data from the central bank.
"It's difficult to say where the support will come from for the ringgit," said Sacha Tihanyi, a Hong Kong-based currency strategist at Scotiabank, which sees the currency tumbling 5 per cent to 3.76 per dollar by year-end. "Most factors are still fundamentally bearish."
- See more at: http://www.straitstimes.com/news/bu...came-lot-harder-20150227#sthash.qUkfoe5U.dpuf
And you still get people talking about the RTS in JB. Where to get so much funds? I foresee that even the HSR would definitely gets delayed.
For these people, its perfectly all right to have wishful thinking, never mind even if it means dang gu gu.
You don't have to dang gugu when you have huat gugu around...haha. Joke aside, i agree with you on this. This project will not start soon....
Since it's not going to start anytime soon or in the near future, RnF should stop misleading people by advertising the RTs is near their property. Seems to me like another half truth advertisement. Since u have been championing developers should not mislead consumers, do turn around, walk straight n tell that to ur own developer. Again, think 3 times before u reply. We always tell u don't throw stones when u live in a glass house.
SGD regain strength again.
MAS seen easing further in April on slowing growth, inflation: Reuters poll
PUBLISHED ON MAR 2, 2015 2:53 PM
SINGAPORE (Reuters) - Singapore's central bank is likely to ease monetary policy further in April as lower-than-expected inflation and output data suggest the economy is slowing and facing growing deflationary pressures, a Reuters poll showed.
Seven out of 11 economists and currency analysts surveyed expected the Monetary Authority of Singapore to re-centre its band for the Singapore dollar's exchange rate level, or widen the band in its regular bi-annual meeting next month.
The central bank manages monetary policy by letting the Singapore dollar rise or fall against the currencies of its main trading partners within an undisclosed trading band based on its nominal effective exchange rate.
"We now expect the Monetary Authority of Singapore (MAS) to further ease policy at its mid-April meeting, given weaker growth prospects and lower inflation risks," said Chua Hak Bin, an economist at Bank of America Merrill Lynch, in a research note. "The MAS will likely re-centre the band lower to the prevailing level of the S$NEER (nominal effective exchange rate)," he said.
On Jan. 28, the MAS unexpectedly eased monetary policy by reducing the slope of its policy band in an unscheduled meeting.
The Singapore dollar on Monday slid to 1.3657 per the US dollar, its weakest since August 2010, after China's central bank cut interest rates on Saturday, underscoring expectations of further easing across Asia.
The Sing dollar lost 0.6 per cent in February, its eighth consecutive monthly depreciation, Thomson Reuters data showed. The data goes back as far as 1981 and it is the longest losing streak since then.
So far this year, it has depreciated 2.8 per cent against the U.S. dollar.
MISS Industrial production in January rose 0.9 per cent from a year earlier, data showed on Thursday, far below a forecast of a 3.7 per cent expansion in a Reuters poll.
The disappointing number came even as the Lunar New Year holidays fell in January last year. The holidays were in February in 2015.
The consumer price index fell 0.4 per cent last month from a year earlier, the largest drop since December 2009, separate data showed.
Still, some economists said it would be premature to predict more stimulus as the economy is not facing recession risks, some economists said.
The government has also taken an expansionary fiscal stance, while inflation could pick up later this year, they added.
Singapore is expected to post a budget deficit of $6.7 billion in the 2015-16 fiscal year with spending up, Finance Minister Tharman Sharmugaratnam said when the government unveiled a budget last week.
"We continue to see a relatively low likelihood of further easing at the next policy review by the Monetary Authority of Singapore in April," economists at Nomura said.
- See more at: http://www.straitstimes.com/news/bu...lation-reuters-poll-2015#sthash.8HoYbQWn.dpuf
PUBLISHED ON MAR 2, 2015 2:53 PM
SINGAPORE (Reuters) - Singapore's central bank is likely to ease monetary policy further in April as lower-than-expected inflation and output data suggest the economy is slowing and facing growing deflationary pressures, a Reuters poll showed.
Seven out of 11 economists and currency analysts surveyed expected the Monetary Authority of Singapore to re-centre its band for the Singapore dollar's exchange rate level, or widen the band in its regular bi-annual meeting next month.
The central bank manages monetary policy by letting the Singapore dollar rise or fall against the currencies of its main trading partners within an undisclosed trading band based on its nominal effective exchange rate.
"We now expect the Monetary Authority of Singapore (MAS) to further ease policy at its mid-April meeting, given weaker growth prospects and lower inflation risks," said Chua Hak Bin, an economist at Bank of America Merrill Lynch, in a research note. "The MAS will likely re-centre the band lower to the prevailing level of the S$NEER (nominal effective exchange rate)," he said.
On Jan. 28, the MAS unexpectedly eased monetary policy by reducing the slope of its policy band in an unscheduled meeting.
The Singapore dollar on Monday slid to 1.3657 per the US dollar, its weakest since August 2010, after China's central bank cut interest rates on Saturday, underscoring expectations of further easing across Asia.
The Sing dollar lost 0.6 per cent in February, its eighth consecutive monthly depreciation, Thomson Reuters data showed. The data goes back as far as 1981 and it is the longest losing streak since then.
So far this year, it has depreciated 2.8 per cent against the U.S. dollar.
MISS Industrial production in January rose 0.9 per cent from a year earlier, data showed on Thursday, far below a forecast of a 3.7 per cent expansion in a Reuters poll.
The disappointing number came even as the Lunar New Year holidays fell in January last year. The holidays were in February in 2015.
The consumer price index fell 0.4 per cent last month from a year earlier, the largest drop since December 2009, separate data showed.
Still, some economists said it would be premature to predict more stimulus as the economy is not facing recession risks, some economists said.
The government has also taken an expansionary fiscal stance, while inflation could pick up later this year, they added.
Singapore is expected to post a budget deficit of $6.7 billion in the 2015-16 fiscal year with spending up, Finance Minister Tharman Sharmugaratnam said when the government unveiled a budget last week.
"We continue to see a relatively low likelihood of further easing at the next policy review by the Monetary Authority of Singapore in April," economists at Nomura said.
- See more at: http://www.straitstimes.com/news/bu...lation-reuters-poll-2015#sthash.8HoYbQWn.dpuf
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Yesterday in JB, I got S$1 = RM2.65
Just changed S$200 at Old Woodlands Centre today at 2.65. Not bad at all.
Sounds great! Rem to invite us to your shiny new house when renovation's done!
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Ya, Bro. Will reserve some items for you to choose...as a door gift.:p
Reno, still lon......g long way to go. :p
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Reuters 2.6778
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