Ringgit Completes Biggest Monthly Gain Since 2012 on Crude Oil

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Malaysia’s ringgit completed its biggest monthly gain since 2012 as a rebound in crude prices brightened prospects for Asia’s only major oil exporter.

The currency strengthened 3.9 percent against the dollar in April, Asia’s best performance. Brent crude jumped 20 percent this month, set for the steepest rise since 2009. Central bank Governor Zeti Akhtar Aziz said April 18 that the currency, the region’s worst performer of the last two quarters with an 11 percent slide, was undervalued. A gauge of dollar strength retreated for a seventh day on Thursday, heading for its worst month since 2011.

The ringgit fell 0.1 percent Thursday to 3.5633 a dollar in Kuala Lumpur, according to data compiled by Bloomberg. It rose as high as 3.5388 earlier, the strongest since Feb. 6.

“The oil story is an important factor,” said Nizam Idris, head of foreign-exchange and fixed-income strategy at Macquarie Bank Ltd. in Singapore. “People who are long dollar-ringgit are also unwinding their positions following the weaker GDP data in the U.S.”

U.S. gross domestic product rose 0.2 percent in the first quarter, less than the 1 percent median estimate in a Bloomberg survey and the 2.2 percent expansion in the preceding three months. The Bloomberg U.S. Dollar Index, which tracks the greenback versus 10 major currencies, has declined 3.1 percent in April, snapping a run of nine straight monthly increases.

The Federal Reserve reiterated on Wednesday it will raise rates when it sees further labor-market improvement and is “reasonably confident” inflation will rise back to its 2 percent goal. The central bank has kept its benchmark rate near zero since 2008.

Malaysian bonds advanced this month. The 10-year yield retreated five basis points, or 0.05 percentage point, to 3.85 percent. The rate declined one basis point on Thursday. Government notes returned 0.5 percent in April for a fourth monthly gain, a Bloomberg index shows.

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