Malaysia’s ringgit was the major loser on Wednesday among broadly muted emerging Asian peers as its third-quarter economic growth appeared set to have lost pace, reflecting a fall in mining output.
The ringgit dropped as much as 0.3% and was pinned near a three-month low against the greenback. Equities in Kuala Lumpur fell up to 0.4%.
Malaysia’s economic growth probably slowed, though only modestly in the third quarter from a year earlier, as solid private consumption and construction activity cushioned the impact of declining mining output, a Reuters poll of economists found.
With the US dollar steady near its highest in more than six months and fears growing over higher tariffs that US President-elect Donald Trump has threatened on imports, the ringgit stays prone to depreciation.
Elsewhere in the region, the Singapore dollar was trading mostly flat, while the Thai baht gained 0.4% and the Philippine peso strengthened 0.1%.
“Moving forward, the local note (ringgit) will trade cautiously ahead of the release of Malaysia’s third quarter GDP on Friday, as well as the US’ key inflation figures,” Bank Islam Malaysia said in a note.
“The election outcome was positive for the greenback, as markets view Trump’s pro-domestic growth, looser fiscal policy stance to encourage more robust economic growth alongside heightening price pressures.”
Asian currencies Thai baht, Malaysian ringgit falls
Stock markets in emerging Asia were mostly mixed, with shares in Thailand gaining 1.1% after its finance minister reaffirmed economic growth expectations of 2.7% for the year, and 2025 growth of 3.5%.
Earlier, the minister, Pichai Chunhavajira had said he was already working to beat Thailand’s 3% estimate.
The southeast Asian nation’s central bank unexpectedly cut its key interest rate in mid-October, for the first time since May 2020, after five consecutive meetings kept them steady.
Analysts at Jefferies and TISCO Securities believe Southeast Asia’s second largest economy is already done with easing rates for fiscal 2024.
“We expect another 25 basis points cut around 1Q 2025,” the analysts said. “This cut should also be a ‘one and done’ for the year, similar to the one cut in Oct 2024.”
Equity markets in Jakarta rose 0.6% while those in Singapore added 0.2%, as shares in Manila lost 0.6% and Taiwan’s benchmark gave up 0.2%.
Global market watchers also await the latest US inflation reading on Wednesday in its consumer price index (CPI) for October.
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