By David Yong
Oct. 30 (Bloomberg) -- Malaysia's ringgit rose by the most in more than a month on speculation interest-rate cuts by central banks in the U.S., China, Hong Kong and Taiwan will help revive investor confidence in emerging markets.
The currency traded near the strongest in a week as Asian stocks advanced for a third day. The Federal Reserve yesterday lowered its target rate for overnight loans between banks for a sixth time this year and agreed to provide dollar swaps with South Korea, Singapore, Brazil and Mexico.
``The concerted rate cuts are meant to help boost the global economy given the likely slowdown ahead,'' said Wan Murezani Mohamad, a senior analyst at Malaysian Rating Corp. in Kuala Lumpur. ``We could see a fleeting improvement in risk appetite as the sources of the current crisis, such as a U.S. housing slump, remain problematic.''
The ringgit jumped 0.9 percent to 3.5485 per dollar as of 8:58 a.m. in Kuala Lumpur, according to data compiled by Bloomberg. It reached 3.5373, the highest since Oct. 22.
The Fed cut its target rate by half a percentage point to 1 percent, matching a half-century low, in an effort to avert a recession. Taiwan cut its discount rate for 10-day loans to 3 percent from 3.25 percent while China reduced its one-year lending rate to 6.66 percent from 6.93 percent.
A Commerce Department report today may show the U.S. economy shrank 0.5 percent last quarter, the most since the 2001 recession, according to a Bloomberg News survey.
To contact the reporter on this story: David Yong in Singapore at dyong@bloomberg.net.
Posts
No comments:
Post a Comment