BUZZ-COMMENT-MYR enjoys a respite but probably not for long
Oct 28 (Reuters) - The Malaysian ringgit is likely to enjoy a respite from selling pressure on signs of easing domestic political tensions, but the backdrop remains worrying.
Prime Minister Muhyiddin Yassin, who has faced calls to resign, won a reprieve Tuesday when the largest party in Malaysia's ruling coalition, the United Malays National Organisation (UMNO), declared its support for him . This brief lull in politicking has allowed USD/MYR to hold below its next resistance level of 4.1730-60.
But Muhyiddin's beleaguered government faces a sterner test on Nov 6 when it presents the 2021 budget, its first since assuming power in March. Political analysts are uncertain whether the government can muster enough votes to get the budget through parliament .
With a mere two-seat majority and damaged credibility from a failed attempt to declare a state of emergency , the prime minister may find it difficult to fend off a leadership challenge from opposition leader Anwar Ibrahim. There are also signs that some of UMNO's corruption-tainted leaders, including former PM Najib, are trying to revive their political fortunes .
A northern hemisphere surge in coronavirus cases and U.S. election uncertainty will further limit USD/MYR downside: a break of 4.1760 will lead to a test of 4.2000.
For more click on FXBUZ
(Krishna Kumar is a Reuters market analyst. The views expressed are his own.)
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Latest Markets Videos
- White House says Walmart, FedEx, UPS to work 24/7 to ease supply bottlenecks for holiday season
- Chinese online brokers Futu and UP Fintech face regulatory risks - People's Daily website
- September, Third Quarter 2021 Review and Outlook
- PRECIOUS-Gold eases as inflation data fans policy tightening bets