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Ringgit Falls Toward Five-Month Low as Export Growth Seen Easing

Feb. 6 (Bloomberg) -- Malaysia’s ringgit fell toward a five-month low before a report that economists forecast will show export growth slowed in December. Government bonds were steady.

Overseas shipments climbed 1.4 percent from a year earlier, compared with a 3.3 percent increase in November, according to the median estimate in a Bloomberg survey ahead of data due Feb. 8. Industrial production advanced 6 percent in December, easing from a 7.5 percent gain the month before, a separate survey showed before a Feb. 8 report. The ringgit has weakened 1.3 percent this year after rallying 3.8 percent in 2012.

“Malaysian exports are on a modest but uncertain improvement path,” said Vishnu Varathan, a senior economist at Mizuho Corporate Bank Ltd. in Singapore. “On average, the ringgit has done quite well so that adds to the export headwinds in the near term.”

The ringgit fell 0.4 percent to 3.0982 per dollar as of 4:37 p.m. in Kuala Lumpur, according to data compiled by Bloomberg. It touched 3.1023 earlier, near the 3.1190 level reached on Feb. 4 that was the weakest since Sept. 7. One-month implied volatility, a measure of expected moves in exchange rates used to price options, was steady at 7.7 percent.

The Malaysian currency weakened as some funds shifted to the U.S. and euro zone on speculation of an economic recovery in those countries, according to Saktiandi Supaat, head of foreign-exchange research at Malayan Banking Bhd. in Singapore.

The yield on the 4.16 percent notes due July 2021 held at 3.46 percent, according to Bursa Malaysia.

To contact the reporter on this story: Liau Y-Sing in Kuala Lumpur at yliau@bloomberg.net

To contact the editor responsible for this story: James Regan at jregan19@bloomberg.net.

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