Ringgit Rises First Time in 4 Days as U.S. Data Boosts Outlook

Malaysia’s ringgit strengthened for the first time in four days as retail sales in the U.S. unexpectedly increased last month, brightening the country’s export outlook.

The MSCI Asia Pacific Index of stocks advanced for a second day after data showed sales in Malaysia’s fourth-largest overseas market gained 0.1 percent, compared with a 0.3 percent decline predicted in a Bloomberg survey. The FTSE Bursa Malaysia KLCI Index of shares was poised for a record close. The government’s 10-year bonds rallied for a seventh day.

“The unexpected rebound in retail sales in the U.S. bodes well for Asian exports,” said Yeah Kim Leng, chief economist at RAM Holdings Bhd. in Kuala Lumpur. “The ringgit’s strength will likely be maintained, given the country’s resilient fundamentals.”

The currency gained 0.3 percent to 2.9879 per dollar as of 4:44 p.m. in Kuala Lumpur, after dropping 1.2 percent in the past three days, according to data compiled by Bloomberg. It touched 2.9803 today, near a 21-month high of 2.9570 reached last week.

One-month implied volatility, a measure of expected moves in the exchange rate used to price options, dropped 18 basis points, or 0.18 percentage point, to 7.24 percent.

The yield on the 3.48 percent notes due March 2023 fell four basis points to 3.09 percent, according to data compiled by Bloomberg. That’s the lowest level for a benchmark 10-year bond since February 2009. The decline was 4.8 times the average move in the past three months, the most among 22 emerging debt markets tracked by Bloomberg.

The treasury sold 3.5 billion ringgit ($1.2 billion) of securities maturing in 2016 to yield 2.926 percent today, with demand exceeding the amount on offer by 1.6 times, according to data published on the central bank’s website.

A report tomorrow may show Southeast Asia’s third-largest economy expanded 5.5 percent last quarter, compared with 6.4 percent in the previous three months, according to the median forecast of 22 economists in a Bloomberg survey.

Before it's here, it's on the Bloomberg Terminal.