Ringgit Jumps Most in Four Months as Oil Gain Boosts Sentimentby
Brent crude rises almost 3 percent, halting three-day slide
Ringgit slid 1 percent in July, worst performance in Asia
Malaysia’s ringgit rose the most in four months as a rally in oil prices boosted growth prospects for the region’s only major net crude exporter.
The ringgit led gains in Asian currencies as Brent crude jumped almost 3 percent, improving the outlook for an economy that derives about a fifth of its revenue from energy-related sources. The ringgit slumped 1 percent last month, the region’s worst performance.
“The ringgit was oversold in July,” said Khoon Goh, head of Asia research at Australia & New Zealand Banking Group Ltd. in Singapore. “Crude oil prices also opened firmer this morning, so that helped boost ringgit at the start of trading.”
Malaysia’s currency advanced 1.2 percent to 4.0233 per dollar as of 2:40 p.m. in Kuala Lumpur, headed for its biggest gain since March 30, according to prices from local banks compiled by Bloomberg. It reached 4.0185, the strongest level since July 20.
The ringgit also benefited after the dollar fell on Friday when disappointing U.S. economic growth figures caused traders to push back bets for when the Federal Reserve will raise interest rates. There’s a 36 percent chance of a increase this year, down from 48 percent odds a week ago, according to data compiled by Bloomberg based on futures contracts.
Malaysia’s bonds rose, with the 10-year yield dropping four basis points to 3.59 percent, according to prices from Bursa Malaysia.