Article: Ringgit Resurgence Seen on Thin Ice
MMJ 20231001
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Ringgit Resurgence Seen on Thin Ice Amid China Economy Risk
Monday, September 4
By David Finnerty
Malaysian currency is 2nd best performer in Asia this quarter
Ringgit may fall to 4.68-4.73 per dollar in near-term: Mizuho
(Bloomberg) --Malaysia’s market watchers are viewing a nascent rally in the ringgit as a temporary reprieve rather than the start of a sustained recovery in the beleaguered currency.
The ringgit became only one of two Asian currencies to eke out gains against the dollar this quarter after finishing the first half of the year near the bottom of the leaderboard. Still, expectations for rally in the ringgit remain low as growth concerns in China, Malaysia’s largest trading partner, and a wide interest-rate gap with the US remain a drag.
“The third quarter has revealed some relief factors - passing state elections and China stepping up on stimulus,” Vishnu Varathan, head of economics & strategy at Mizuho Bank Ltd. in Singapore said referring to the ringgit’s gains. “While the ringgit need not be staring down a cliff, it is premature to suggest it is out of the woods,” he added.
The ringgit remains vulnerable to factors such as lingering political tensions, a sharp correction in oil prices in case of a global downturn, and a bumpy China recovery, according to Varathan. He is not alone in thinking the currency’s strong start to the third quarter may peter away.
“The ringgit outperformance seems to be driven by improving export conversion ratio,” says Moh Siong Sim, FX Strategist at Bank of Singapore Ltd. “But this could be temporary and the performance ranking may slip given the drag from still wide unfavorable interest rate differential vis-a-vis the dollar and lingering yuan depreciation pressures.”
Mizuho’s Varathan sees the ringgit weakening to 4.68-4.73 per dollar levels in the near-term. The currency closed down 0.2% at 4.6462 on Friday.
MMJ's Comment
After conniving to get the USD as the international currency at Bretton Woods in 1945, the US created the US Treasury international market as a natural harbour for overseas holding of USD. The world was screwed from that moment onwards.
As an international currency is constantly widely demanded US Presidents started printing much more USD than gold only to be caught by De Gaulle when he threatened to arrive in New York with two plane loads of USD to convert to gold. Nixon panicked and abandoned the peg. The USD should experience a free fall but the USD Treasury safety net and a miseducated world propped the Zionist infested govt. Today we have robot analysts the world over parroting the machinations of the dubious injustice plagued system.
The Fed simply has to raise their interest rates and the USD will strengthen and these robotic analysts will say other countries' economies are weak compared to the US economy. They have also screwed up the education system preventing independent thought. All new thoughts must be tied to old wisdom.
Muslim Academics must ask themselves why they can't incorporate the brilliance and intelligent guidance of the Quran in their academic world? But they don't, fearing their peers more than their Creator. The robot analysts, instead of addressing their minds on how to release the world from the grip of the fraudulent USD and US Treasury Market, are also an unthinking lot parroting the machinations of a failed system. Failure to the world but success to the US - but they don't care - lost in their comfortable ignorance.
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Dikemaskini [Updated]: Sam Ahmad 20231001