KUALA LUMPUR, Dec 13 — Malaysia’s ringgit fell for an eighth week, its longest losing streak since November 2005, on speculation US policy makers will curb stimulus amid signs of a strengthening economy. Government bonds advanced.

US retail sales rose 0.7 per cent in November, the biggest gain in five months, and exceeded the median forecast of economists for a 0.6 per cent increase, official data showed yesterday. Other reports in December showed a pick-up in manufacturing and employment before next week’s Federal Open Market Committee meeting. An Increase in household debt in Malaysia is a risk for the local economy and the liabilities could be “problematic” if growth slows, Ritesh Maheshwari, an analyst at Standard & Poor’s, said in a December 11 teleconference.

“The focus on next week’s FOMC meeting, where we expect the Fed to start tapering, flowed through to Asian currencies,” said Khoon Goh, a senior foreign-exchange strategist at Australia & New Zealand Banking Group Ltd. in Singapore. “Ringgit weakness simply reflected this.”

The Malaysian currency retreated 0.1 per cent this week and 0.2 per cent today to 3.2358 per dollar in Kuala Lumpur, according to data compiled by Bloomberg. One-month non- deliverable forwards dropped 0.7 per cent from December 6, the biggest five-day loss since November 1, and fell 0.2 per cent today to 3.2380. That’s 0.1 per cent weaker than the spot rate.

Trade balance

One-month implied volatility, a measure of expected moves in the exchange rate used to price options, declined nine basis points, or 0.09 percentage point, this week to 8.06 per cent and rose five basis points today.

Malaysia, Southeast Asia’s third-biggest economy, posted a trade surplus of RM8.2 billion in October, compared with RM8.66 billion the previous month, official data showed last week. The gap was RM1 billion in April, the least since 1997.

The ringgit will appreciate to 3.18 within three months, supported by recent improvements in the trade balance, Goldman Sachs Group Inc. analysts including Singapore-based Mark Tan wrote in a report yesterday.

The yield on the 3.48 per cent sovereign notes due March 2023 declined seven basis points this week to 4.07 per cent, according to data compiled by Bloomberg, the biggest five-day drop since the period ended October 25. It was little changed today. — Bloomberg