Ringgit Drops After China Data Dim Malaysia’s Export Outlook

Malaysia’s ringgit weakened, halting a three-day gain, on concern slowing growth in China will damp demand for exports from the Southeast Asian nation. Bonds declined.

The MSCI Asia-Pacific index of shares dropped after industrial companies in the world’s second-largest economy and Malaysia’s biggest overseas market posted their first January- February profit declines since 2009. The ringgit has slid 2.6 percent this month after official data released on March 7 showed annual export growth slumped to 0.4 percent in January from 6.1 percent in December.

The ringgit weakened 0.2 percent to 3.0633 per dollar as of 4:27 p.m. in Kuala Lumpur, according to data compiled by Bloomberg. It advanced 3.6 percent this quarter, the second-best performance among Asia’s 11 most-used currencies.

“The China slowdown concern is hurting Asian currencies,” said Azmi Shukri Rahman, a foreign-exchange trader at CIMB Investment Bank Bhd. in Kuala Lumpur. “The Malaysian currency will likely trade between 3.055 and 3.075 today.”

The ringgit’s one-month implied volatility, a measure of exchange-rate swings used to price options, retreated 10 basis points to 7.30 percent.

Ten-year government bonds fell. The yield on the 3.418 percent bonds due August 2022 increased four basis points, or 0.04 percentage point, to 3.68 percent, according to Bursa Malaysia. That’s the highest since the securities were sold in February.

To contact the reporter on this story: Elffie Chew in Kuala Lumpur at echew16@bloomberg.net.

To contact the editor responsible for this story: Sandy Hendry in Hong Kong at shendry@bloomberg.net.

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