Ringgit at 17-yr low as global funds sell stocks, bonds
It slumped as much as 2.8% before closing 1.7% down at 4.0795 a US dollar in KL
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MALAYSIA'S ringgit plunged the most since 1998 on concern the nation is running out of ammunition to defend its currency amid a political scandal, a yuan devaluation and slumping oil prices. Stocks and bonds tumbled.
The ringgit led a retreat in Asia this week as governor Zeti Akhtar Aziz said on Thursday that the central bank will need to rebuild foreign exchange reserves that have fallen below US$100 billion for the first time since 2010. Better-than-expected economic data on Thursday failed to dispel the gloom, with the benchmark stock index closing at its lowest since 2012 and 10-year bonds sliding the most in at least five months.
It's a "bit of a vicious cycle from the currency", said Saktiandi Supaat, head of foreign exchange research at Malayan Banking Bhd in Singapore. "Declines in the ringgit beyond 4.05 a dollar are triggering fixed-income outflows."
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