KUALA LUMPUR (May 6): Bank Negara Malaysia’s (BNM) international reserves fell 0.21% to US$97 billion (RM381.4 billion) as at April 29, 2016 from US$97.2 billion (RM382.1 billion) as at April 15, 2016.

In a statement today, the central bank said the reserves position is sufficient to finance 7.9 months of retained imports and is 1.1 times the short-term external debt.

After depreciating to its intra-day weakest point at 4.0190 today, the ringgit strengthened against the US dollar to 4.0043.

The ringgit fell below the 4.0000 level yesterday, closing 4.0043 against the greenback after US policy makers indicated the US Federal Reserve might increase interest rates next month.

Higher US interest rates does not augur well for emerging Asian markets like Malaysia in anticipation that investors will shift their funds back to US dollar-based assets.

Over the last one year, the ringgit had traded between 3.5608 and 4.4812 versus the US dollar. On March 29 this year, the ringgit strengthened past the 4.0000 mark to 3.9925.

Reuters reported today that St. Louis Federal Reserve President James Bullard said on Thursday the Fed could raise rates at its meeting next month if the economic data calls for it, despite the fact that traders see only a slim chance of it happening.

"We've got our options open," Bullard was quoted saying in the report. "I would expect market probabilities will change if the data changes." 

The FBM KLCI also reversed losses to close 0.3% higher at 1,649.36 points today, on the back of a stronger ringgit.