KUALA LUMPUR, April 11 — The ringgit fell the most in three weeks on speculation some investors are buying dollars to take advantage of a favourable exchange rate after the Malaysian currency touched a four-month high yesterday.

It declined 0.4 per cent to 3.2370 per dollar in Kuala Lumpur after rallying 1.9 per cent over the previous five days, data compiled by Bloomberg show. That pared its weekly gain to 1.3 per cent, the biggest five-day advance since October.

The dollar’s 14-day relative strength index against the ringgit was 31 yesterday, near the 30 threshold that signals to some traders that the US currency will rebound. The MSCI Asia Pacific Index of shares slid 1 per cent today after the Nasdaq Composite gauge in the US plunged 3.1 per cent yesterday, the most since 2011.

“The ringgit has had a great few sessions,” said Jonathan Cavenagh, a Singapore-based currency strategist at Westpac Banking Corp. “That’s definitely seeing a little bit of profit-taking. There are concerns around what’s happening with broader US equity market sentiment, and is that going to spill over to emerging markets in Asia.”

One-month implied volatility, a measure of expected moves in the exchange rate used to price options, fell four basis points, or 0.04 of a percentage point, to 6.48 per cent. It has dropped 21 basis points since April 4.

Industrial production

Malaysia’s industrial production rose 6.7 per cent in February from a year earlier, the fastest pace since July and exceeding the median forecast of economists for a 6.2 per cent gain, according to a government report yesterday.

Southeast Asia’s third-biggest economy will expand 5.2 per cent this year and 5 per cent in 2015, the International Monetary Fund said in its World Economic Outlook on April 8. Gross domestic product increased 4.7 per cent in 2013.

Nomura Holdings Inc predicts Bank Negara Malaysia will deliver 50 basis points of interest-rate increases in the second half of the year, amid prospects of quickening inflation, according to a report published yesterday.

The central bank has held the policy rate at 3 per cent since May 2011 even as consumer-price gains advanced to a 32-month high of 3.5 per cent in February.

The yield on Malaysia’s 4.181 per cent sovereign bonds due July 2024 was steady at 4.09 per cent. The yield fell five basis points this week, the biggest drop since the period ended February 7, data compiled by Bloomberg show. — Bloomberg