KUALA LUMPUR, Dec 9 — Malaysia’s ringgit strengthened by the most in six weeks after China, the nation’s second-largest export market, reported its biggest trade surplus in almost five years. Government bonds fell.
The currency halted a four-day decline as China’s surplus grew to US$33.8 billion (RM108.7 billion) in November from a year earlier, the highest since January 2009, according to customs data released yesterday. A US Labour Department report last week showed companies added 203,000 jobs to payrolls last month, more than the 185,000 increase predicted by economists in a Bloomberg survey and up from a revised 200,000 in October.
“The China trade numbers were better than expected so that could have played a part,” said Saktiandi Supaat, head of foreign-exchange research at Malayan Banking Bhd. in Singapore. “Some were expecting even stronger payrolls data, so when it came out, the players were closing their positions.”
The ringgit appreciated 0.5 per cent to 3.2170 per dollar as of 10:22am in Kuala Lumpur, the biggest gain since October 28, according to data compiled by Bloomberg. The currency dropped 5 per cent this year on prospects the Federal Reserve will trim stimulus that’s spurred demand for emerging-market assets.
One-month implied volatility, a measure of expected moves in the exchange rate used to price options, fell 17 basis points, or 0.17 percentage point, to 7.98 per cent.
The yield on the 3.172 per cent sovereign notes due July 2016 rose one basis point to 3.28 per cent, the highest level since October 14, data compiled by Bloomberg show. The rate on the 10-year securities was little changed at 4.14 per cent after climbing 42 basis points over the past month.
BNP Paribas SA sees “rotation flows” into Malaysian government bonds next year given the political concerns in Thailand and Indonesia, its strategists including Singapore-based Mirza Baig wrote in a December 6 research note. — Bloomberg
