Ringgit marks time with trade, Fed minutes in focus

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KUALA LUMPUR (Feb 19): Ringgit trades in narrow range as investors weigh buoyant crude prices against potential risks from the U.S.-China trade dispute and the Federal Reserve’s policy minutes due this week.

* USD/MYR rises 0.1% to 4.0915 vs range of 4.0800-4.0915

** Resistance 4.1045, 4.1314, 4.1486; support 4.0677, 4.0550, 4.0435

* EM FX are likely to be in holding pattern for now amid concerns about slowing global growth, says Sim Moh Siong, FX strategist at Bank of Singapore

** Outcome of U.S.-China trade discussions will provide some direction, and traders are likely to parse upcoming PMI reports for any signs of stabilization

* Malaysia’s 10-year govt bond yield ended at 3.9% Monday

* January CPI probably fell 0.4% y/y vs +0.2% prior, according to a Bloomberg survey ahead of data due Friday

* Malaysian price pressures will probably bottom in the coming 1-2 months and should start to rise from 2Q, Irvin Seah, an economist at DBS, wrote in note Monday

** Still, inflation is expected to remain benign and taken together with the slower growth outlook, BNM will likely stay on hold this year

* All activities on bauxite mining and exports in the state of Pahang can resume after March 31 when a moratorium is lifted: Water, Land and Natural Resources minister Xavier Jayakumar 

** NOTE: Malaysia, previously the biggest shipper of bauxite to China, stopped mining in 2016 amid concern about pollution from dust

* Malaysia’s Islamic market capitalization reached RM1.88t in 2018, accounting for 61% of the total: Securities Commission