We think Ringgit is going to strengthen after budget 2015

We don’t believe US interest rate increase can have such a big impact on emerging currency.  Even FED does it in months to come merely 25 basis points or most 50.  We don’t believe emerging markets are that off the financial track.  Currency devalued by 20 to 30% in 12 months time is severe.

We also do not believe is 1MDB although there is a potential credibility impact.  Be it RM 100 billions in debt that a figure Malaysia can absorb any given time.

Budget based on oil at USD 100 per barrel is the main problem.  After new budget announced we believe Ringgit will stabilise further.  Currency devaluation war will persist. 

Oil price will slowly recover back to USD 60 per barrel as OPEC target.   RM will stabilise and strengthen against other currencies in next 12 months.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Create a free website or blog at WordPress.com.

Up ↑

%d bloggers like this: