KUALA LUMPUR, June 9 — Malaysia’s ringgit rose to a three-week high after crude rallied to levels last seen in October, boosting the outlook for Asia’s only major net oil exporter.
The currency led gains in Asia as Brent crude extended gains after jumping more than 2 percent to levels above US$52 (RM209.18) a barrel.
Sentiment toward emerging-market assets has also been bolstered by indications the Federal Open Market Committee will proceed gradually with any interest-rate increases.
US policy makers next meet June 14-15.
“Fed speakers are in a blackout period prior to the FOMC meeting next week, so there’s less noise,” said Christopher Wong, a foreign-exchange strategist at Malayan Banking Bhd in Singapore.
The “potential deferred decision of a Fed rate hike in June leading to relative softness in the dollar and relative stability in oil prices” are supporting the ringgit, he said.
The ringgit climbed 0.5 per cent to 4.0430 per dollar as of 9:09am in Kuala Lumpur and reached 4.0303, the strongest level since May 18, prices from local banks compiled by Bloomberg show.
A gauge of the dollar dropped for a third day to a one-month low.
Malaysia derives about a fifth of government revenue from oil-related sources.
The nation loses RM450 million for every US$1 drop in oil, Prime Minister Datuk Seri Najib Razak said in April. — Bloomberg
