Malaysian Ringgit Is Little Changed as Stocks Drop, Risk Climbs

By David Yong

Nov. 18 (Bloomberg) -- Malaysia's ringgit traded near the lowest in almost two years on speculation a deepening global economic slowdown will erode demand for regional assets.

The ringgit was little changed as the MSCI Asia Pacific Index of stocks fell for a second day after a gauge of manufacturing in New York area declined to the lowest level on record. Malaysia's statistics department will report September manufacturing sales at 12:01 p.m. in Kuala Lumpur.

``Economic data are beginning to show that the slowdown will hit Asia quite hard from here,'' said Lam Chee Mun, who oversees $200 million in assets as a fund manager at TA Investment Management in Kuala Lumpur. ``The risk premium is still elevated in the region.''

The ringgit traded at 3.5995 per dollar as of 9:10 a.m. in Kuala Lumpur versus 3.6005 yesterday, according to data compiled by Bloomberg. It has weakened 2 percent in the past month.

The cost of protecting sovereign debt against default rose yesterday to the highest this month for both Malaysian and South Korean investment-grade bonds, according to credit-default swap prices compiled by Bloomberg News.

To contact the reporter on this story: David Yong in Singapore at dyong@bloomberg.net.