Ringgit set for worst run since peg ended.........

It is good news for Malaysian exporters when Ringgit Malaysia has slumped to all year low i.e 3.3372 this year. However, the weakening Ringgit is definitely not a good news for Malaysian consumers as they might have to pay more for the imported goods. Inflation has hit all time high in Malaysia,coupling with weakening Ringgit, I will not be surprised if Bank Negara is scratching their head now.......

Ringgit set for worst run since peg ended

The ringgit slumped 0.4 per cent to 3.3270 per dollar as of 4.45 pm in Kuala Lumpur, having earlier touched 3.3372, its low for the year.

THE ringgit fell for an eighth day, the longest losing streak since a peg to the dollar was scrapped in July 2005, on speculation the economy will cool as exports slow. Bonds advanced.

The currency has dropped every day this month and its 2.3 per cent slide against the greenback is second only to the Singapore dollar's among Asia's 10 most traded currencies outside Japan. Malaysia's US$147 billion economy expanded at a "moderate" pace in the second quarter, Prime Minister Datuk Seri Abdullah Ahmad Badawi said yesterday.

"Recent data signal more downside risk to the currency," said Joanna Tan, a Singapore-based economist at Forecast Pte. "Malaysian exports are susceptible to headwinds and won't escape the erosion in global demand."The ringgit slumped 0.4 per cent to 3.3270 per dollar as of 4.45 pm in Kuala Lumpur, according to data compiled by Bloomberg. The currency earlier touched 3.3372, its low for the year.

JPMorgan Chase & Co today cut its ringgit forecast for a second time in two weeks, reducing its year-end target to 3.38 per dollar from 3.20. Electronics exports from South Korea, Taiwan, Singapore and Malaysia will bear the brunt of a slowdown in the US, Japan and Germany, the bank said in a research note.Governor Tan Sri Dr Zeti Akhtar Aziz yesterday said any market intervention won't be done to affect the underlying trend of the ringgit.

The central bank will report second-quarter gross domestic product on August 29 and the government will present its 2009 budget on the same day.Bonds GainMalaysia's economy grew 7.1 per cent from a year earlier in the first quarter, after expanding 7.3 per cent in the final three months of 2007.

Singapore, which was Malaysia's biggest overseas market in the first half, yesterday reported the slowest economic growth in five years and forecast exports would drop this year for the first time since 2001.Ten-year notes gained, ending five days of losses, pushing yields to the lowest in a week.

Slower growth may temper inflation from the current 26-year high going into 2009, Zeti said yesterday.The yield on the 4.24 per cent note maturing in February 2018 fell 12 basis points to 4.72 per cent, according to Bursa Malaysia Bhd's electronic bond exchange. The price jumped 0.933, or RM9.33 per RM1,000 face amount, to 96.4. A basis point is 0.01 percentage point.Malaysia will auction RM3.5 billion of Islamic bonds maturing in February 2014 on August 13 in the only sale scheduled this month. - Bloomberg