FX Ringgit 02 July 2010

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hi,

The FX news for the ringgit, and other currencies, for the week ending Friday 3nd July 2010 :




02 July2010 : Treaury Pulse - Global Foreign Exchange Market
SIGNS of fragility in the global economy became evident as the week was characterized by a slew of weak global economic data. Fears of faltering growth in the United States, the world’s largest economy, resurfaced following weak spots in the housing, manufacturing and labour sectors. US pending home sales declined to 30.0% in May while manufacturing, as measured by the ISM Index, fell by a higher-than-expected 5.9% in June as export orders softened on the back of uncertainties emanating from the European debt crisis.

Weakness in US economic data precipitated the US dollar to close the week lower against most major currencies. At the point of writing, the US Dollar Index declined 0.9% from a week earlier.

Meanwhile, optimism of a China-led recovery dimmed as Conference Board’s China leading economic index rose only by a marginal 0.3% in April, the lowest since November 2009. Moderation in China’s economic growth is further confirmed by the decline in the HSBC’s Purchasing Managers’ Index in June.

Nonetheless, regional Asian economies remain resilient as South Korea’s industrial production rose by a quicker-than-expected 21.5% in May while Thailand’s exports recorded a sharp rise of 42.5% , also in May. In Europe, initial doubts surrounding banks’ capability to repay European Central Bank (ECB)’s 12-month long-term refinancing operation loan worth 442 billion euros prompted EUR/USD to decline to 1.2100-levels. However, towards the later part of the week, EUR/USD catapulted back to 1.2500-levels, its quickest gain since May, after ECB announced a marked reduction in its lending to the banks, thus alleviating fears of liquidity risk.

Additionally, some confidence returned after Spain successfully issued its 3.5-billion euro five-year government bond at an average yield of 3.657% (compared to 3.532% at a May’s auction). Demand was decent with a bid-to-cover ratio of 1.7 times although lower than the ratio of 2.35 times previously. The rally in the euro also lent support to the British pound which closed the week above the 1.5100-handle against the US dollar. This came despite a report indicating that UK consumer confidence tumbled to a six-month low in June, prompted by the recent Government Emergency Budget which includes steep spending cuts and tax hikes.

Sagging global equities markets precipitated an initial weakening of Asian currencies against the US dollar, including the ringgit. However, the ringgit recovered towards the end of the week in tandem with other regional currencies following resilient economic data out of Asia. As of Friday noon, the Bloomberg-JP Morgan Asia Dollar Index, which tracks 10 regional Asian currencies, closed the week relatively flat while USD/MYR traded at 3.2230, gaining 0.3%.
End of Article
Starbizweek
http://biz.thestar.com.my/news/story.asp?file=/2010/7/3/business/6597674&sec=business


03 July 2010 : FOREX: Ringgit May Strengthen Against US Dollar Next Week
KUALA LUMPUR, July 3 (Bernama) -- The ringgit may strengthen against the US dollar next week and will likely test the 3.10 to 3.18 level as expectations of positive growth for the Malaysian economy will provide support for the local currency, dealers said.

Inter-Pacific Research Sdn Bhd in its research note said room for the ringgit to overshoot remained high, projecting the ringgit to average at 3.20 in 2010 and 3.15 in 2011 against the US dollar, mainly supported by the anticipated 6.5 per cent gross domestic product (GDP) growth in 2010 and 6.7 per cent in 2011. The ringgit was the strongest at 3.13 level as against the US dollar for the past two years.

During the week just ended, the ringgit moved mostly higher against the US dollar as expectations of positive economic growth for the Malaysian economy helped to sustain the ringgit at the 3.23-3.24 level against the dollar. Against other major currencies, the ringgit was choppy as the euro, yen and British pound movements tracked the strength of the US dollar and developments in the debt crisis of Europe.

The ringgit ended higher on Friday as compared to the previous day, tracking the euro rally against the greenback. The euro strengthened as concerns eased up on the euro zone debt crisis after Spain sold five-year bonds worth 3.5 billion euros.

On a Friday-to-Friday basis, the ringgit was higher against the US dollar at 3.2220/2250 from 3.2510/2550 previously. It also rose against the Singapore dollar to 2.3118/3163 from 2.3275/3320 last Friday but was easier against the yen at 3.6634/6681 from 3.6271/6320 last Friday.

The ringgit was lower both against the British pound at 4.8981/9030 from 4.8407/8483 last Friday and the euro at 4.0275/0322 from 3.9958/9017.
End of Article
BERNAMA
http://www.bernama.com/bernama/v5/newsmarket.php?id=510579