Malaysia's Covid-19 Situation Under Scrutiny, Signs Of Easing Infectivity Eyed

The ringgit outperformed its regional peers on Tuesday, as onshore Malaysian markets reopened after a long weekend. Spot USD/MYR played catch up with Monday's market moves, while the ringgit may have drawn some support from the easing Covid-19 case count in Malaysia. The rate last trades +10 pips at MYR4.1223, as trading resumed in Kuala Lumpur.

• Director-General of Health Noor Hisham said Tuesday that Covid-19 infectivity rate (R0) in Malaysia eased for the third straight day and is estimated to be at 0.95, as reported by Malay Mail. Just to clarify, R0 of less than 1 indicates that on average, any Covid-19 case infects less than one further person. At the same time, Noor Hisham warned that the use of intensive care (ICU) beds has rapidly increased over the last two weeks and has topped 100%, which "means there is no space for patients who come in needing intensive care". He noted, however, that the same period saw a decrease in the use of non-ICU Covid-19 beds.
• Health Min Adham said that the gov't is planning to include children aged 12-17 in the national Covid-19 immunisation programme in its fifth phase, due to start in August.
• Malaysia's foreign reserves rose to $110.9bn through May 31 from $110.6bn reported on May 12, reaching the highest level since early 2015.
• On the radar this week, we have Malaysian industrial output, due Friday.
• From a technical perspective, a break above Jun 4 high of MYR4.1330 would bring May 31 high of MYR4.1480 into view. Bears need a slide through Jun 1 low of MYR4.1167 before taking aim at the 200-DMA, which kicks in at MYR4.1070.