Ringgit falls as weaker yuan hurts EM Asia FX

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KUALA LUMPUR (June 10): Ringgit falls for the first time in six days, tracking a decline in the yuan after China’s central bank chief indicated the authorities may tolerate a weaker currency. EM currencies are also weighed down by dollar strength.

* USD/MYR gains 0.1% to 4.1640 after declining 0.8% in previous five sessions

** Support 4.1413, 4.1252; resistance 4.2028, 4.2437, 4.2535

* Pair’s uptrend from 4.06 to 4.20 is intact on a technical perspective as long as it stays above 4.14 to 4.15, says Mingze Wu, a foreign-exchange trader at INTL FCStone Global Payments in Singapore

** Next key level is 4.15 psychological level, with top side seen at 4.20

* Nation’s 10-year bond yield falls 1bp to 3.70%

* Malaysia has benefited from the US-China trade war through trade diversion and business relocation, Finance Minister Lim Guan Eng said Friday

* Industrial production probably increased 2.5% in April y-o-y vs +3.1% prior, according to Bloomberg survey before data due Tuesday