By David Yong
Jan. 15 (Bloomberg) -- Malaysia’s ringgit dropped to its weakest level in more than a month against the dollar on concern deepening recessions in the U.S. and Japan will hurt exports.
The currency fell after U.S. retail sales in December plunged at twice the pace forecast by economists and machinery orders in Japan posted a record decline for November. The MSCI Asia Pacific Index of regional shares fell to a one-month low, with benchmarks sliding across regional markets open for trading.
“Any news that impacts Malaysia’s export outlook will have a bearing on the ringgit,” said Gan Kok Kim, head of treasury at OCBC Bank (Malaysia) Bhd. in Kuala Lumpur. “While most of the bad news is already out, it doesn’t mean that emerging markets cannot continue to sell off.”
The ringgit dropped 0.7 percent to 3.5938 per dollar as of 9:27 a.m. in Kuala Lumpur, according to data compiled by Bloomberg. It reached 3.5945, the lowest since Dec. 11, and is down 3.9 percent so far this year.
Malaysia’s exports slumped 4.9 percent in November, the first drop since July 2007. Singapore, the U.S. and Japan, which together accounted for 38 percent of Malaysia’s overseas sales in 2008, are all in the midst of recessions.
Malaysia’s economy will contract for a second quarter in the three months to March 31, pushing it into a technical recession, Citigroup Inc. said this week. The economy last slipped into a recession in the final quarter of 1998.
To contact the reporter on this story: David Yong in Singapore at dyong@bloomberg.net.
Posts
No comments:
Post a Comment