SINGAPORE: The Malaysian ringgit rose on Thursday, getting some respite in the wake of its drop to a near six-year low earlier this week, while the Indian rupee rose after the central bank surprised markets with an early interest rate cut.
The ringgit was quoted at 3.5640 versus the dollar, up from Wednesday's low of 3.6020, the lowest since April 2009, according to Reuters data.
Stop-loss orders and a drop in the Singapore dollar against the ringgit helped lift the Malaysian currency.
The ringgit gained some respite after oil prices rose the previous day, said Vishnu Varathan, a senior economist with Mizuho Bank in Singapore.
"Apart from the oil, there's this other factor, where we don't see the dollar surging against many of the Asian currencies," he added. Asian currencies were mostly higher against the dollar on Thursday.
Over the next couple of months, however, the risks are tilted toward a higher dollar versus the ringgit, since it seems unlikely that oil prices will see a sustained recovery so soon, Varathan said.
The ringgit has been vulnerable to falls in oil prices due to Malaysia's status as an oil exporter.
World oil prices had their biggest surge in two-and-a-half years on Wednesday, rebounding from a nearly six-year low as traders turned away from the bearish pressure of a worldwide glut to cover themselves on expiring options.
On Thursday, oil prices edged lower, giving back some of Wednesday's hefty gains.
The Indian rupee touched its highest in about two months as local bonds and stocks rose after the central bank surprised investors with a rate cut ahead of a scheduled policy review next month.
Although markets had been widely pricing in a rate cut, most investors had expected the Reserve Bank of India to move either at its policy review on Feb. 3 or sometime after the government unveiled its annual budget at the end of February.
The rate cut is likely to support the rupee in the near term, analysts at Standard Chartered said in a research note.
"Today's policy move adds to the mix of improving fundamentals, lower commodity prices and likely foreign inflows near-term," they said.
INDONESIAN RUPIAH
Indonesia's central bank is expected to maintain its key interest rates at a policy meeting on Thursday, on anticipation that inflation will cool following a spike in late 2014.
SOUTH KOREAN WON
The South Korean won pared losses after the central bank held its policy interest rates steady, as some investors had priced in expectations of a surprise rate cut.
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