Ringgit rate swaps rise on tightening bets

At 9 am(0100gmt), the local unit was traded at 4.1490/1520 against the greenback from Monday's close of 4.1480/1510.

KUALA LUMPUR: Malaysian interest-rate swaps climbed for a third day on Thursday as traders maintain bets for policy tightening even as data showed inflation eased last month.

The one-year interest-rate swaps rose one basis points to 3.65%; swaps have gained since Bank Negara Malaysia signalled on Nov 9 it may raise interest rates

The US dollar/ringgit fell 0.1% to 4.0712. The support levels are 4.0360, 4.0000, 3.9300 and resistance levels at 4.1990, 4.2440, 4.2535.

Pair is likely to stay within range of 4.000 to 4.200 with limited room for ringgit to strengthen further, says Masashi Murata, a currency strategist at Brown Brothers Harriman in Tokyo.

He doesn’t see Bank Negara tightening policy at January review as policy makers would want to prevent excessive ringgit strength given the economy’s heavy dependence on exports.

RHB expects Bank Negara to raise the benchmark rate by 25bps next year, economists including Arup Raha write in report.

“Increase to take place amid further strengthening in domestic economy and will be in tandem with policy tightening by major central banks,” it said. - Bloomberg