• Dollar's bullish trend pauses amidst Thanksgiving Holiday

• MYR to fluctuate in the range of 4.2264 and 4.2400 against US dollar

Global Highlights

The dollar index slipped slightly by 0.10% to 96.774, as the dollar’s rally trend paused amidst lower trading due to Thanksgiving holiday in the US.

Both the stock and bond markets in the US were closed on Thursday and will close early on Friday due to Thanksgiving holiday. The Dow Jones steadied at 35,804 and S&P5 00 was flat at 4,701. The UST 10-year yield was stable at 1.634%. Gold took another breather from the descending trend as it inched higher 0.01% to US$1,789/oz.

The euro logged a slight recovery as it inched up 0.09% to 1.121. On the data front, the GfK Consumer Climate Indicator in Germany fell to -1.6 heading into December from +1 in November and compared to market forecasts of -0.5 point. It was the lowest reading since June, as consumers grew increasingly worried about inflation and the Covid-19 situation.

On the pandemic development, the situation in the Eurozone remained grim as official figures released yesterday showed that the Covid death toll in Germany has passed 100K while Italy and France introduced new measures to curb the outbreak.

The British pound lost 0.05% to a new 2021 low at 1.332. The CBI distributive trades survey’s retail sales balance in the UK jumped to +39 in November, suggesting retail sales were good for the time of year.

The Japanese yen retreated slightly from its five-year low as it strengthened 0.06% to 115.36. The stance between the Fed and the BoJ widened with the latest FOMC meeting indicating that the officials have become more hawkish to tame inflation.

In the meantime, the Chinese yuan appreciated by 0.10% to 6.386 underpinned by continued corporate demand but some traders and analysts expect Beijing to rein in the strong yuan.

Crude oil was relatively unchanged when Brent remained at US$82 per barrel while WTI at US$78 per barrel as OPEC is expecting the crude oil release by the US will “swell” the surplus in oil market to 1.1mil barrels per day.

Malaysia Highlights:

The ringgit closed on a weaker note as it depreciated 0.43% to 4.230. It was traded at a high of 4.2302 and low of 4.2108, amidst broad stronger greenback.

The FBM KLCI dropped 0.31% to 1,518, in tandem with most of its regional peers. Detailed transactions revealed that retailers were net buyers with RM20.3mil while local institutions and foreign investors were net sellers.

The local bond market was also quiet yesterday. The 3-year yield was +1.0bps to 2.750% while the 5-year, 7-year and 10-year remained unchanged at 3.180%, 3.415% and 3.570%, respectively.

The IRS yields movements were mixed with the (3Y) at -0.5bps to 2.745% while the (5Y) +0.5bps to 2.990%. Both the (7Y) and (10Y) remained unchanged at 3.230% and 3.400%.

Against major currencies, the ringgit tumbled across the board. It weakened vs. the EUR by 0.59% to 4.747, vs. the GBP by 0.18% to 5.639, vs. the AUD by 0.05% to 3.041, vs. the JPY by 0.48% to 3.667, and vs. the CNY by 0.51% to 1.510. Regionally, the ringgit also slipped vs. the SGD by 0.37% to 3.093, vs. the THB by 0.52% to 7.892, vs. the IDR by 0.27% to 3,378, vs. the PHP by 0.28% to 11.921 and vs. the VND by 0.45% to 5,362.

MYR Outlook For The Day

We expect the MYR to trade between our support level of 4.2169 and 4.2264 while our resistance is pinned at 4.2400 and 4.2450.

Source: AmInvest Research - 26 Nov 2021