Ringgit rises as China trade talk lifts Asia EM

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KUALA LUMPUR (Aug 16): Ringgit ekes out a gain as a report of Chinese plans for US trade talks offsets concerns over the spillover impact from the ongoing Turkey crisis.

* USD/MYR slips 0.1% to 4.1018; EM Asia FX broadly up against greenback

* NOTE: China said Thursday that Vice Commerce Minister Wang Shouwen will be traveling to the US for trade talks in late August, the first official exchanges since earlier negotiations broke down in June

* Mizuho Bank is bearish on EM FX due to the US-China trade war and a technical break in EUR/USD of 1.15, says Masakatsu Fukaya, an emerging-market currency trader in Tokyo

** Co. prefers to be long USD/CNH, USD/TWD and USD/KRW in current environment

* USD/MYR is expected to trade within 4.0958–4.1080 range, with dollar play continuing to gain traction amid the crisis in Turkey, AmBank wrote in a daily note

** NOTE: Bloomberg Dollar Spot Index trades near 13-month high

* 10-year govt bond yield steady at 4.07%

* Govt will return RM19.4 billion of goods and services tax refunds that haven’t been paid out, starting next year: Finance Minister Lim Guan Eng

* Govt to reopen a probe into state fund 1MDB by the Public Accounts Committee: Lim

* DBS recommends buying Malaysian stocks on declines triggered by global trade tensions ahead of the national budget in November, which is expected to shed light on the state of govt finances

** NOTE: Malaysian equities recorded outflows in each of the previous 3 months