Malaysia's Ruling Coalition Gets Shattered By Infighting

Spot USD/MYR printed fresh multi-month highs on Friday and still holds above its 200-DMA, despite edging lower in early Asia-Pac trade today. The spot last deals -25 pips at MYR4.1445.

• During its general assembly meeting held over the weekend, Umno decided to sever its ties with PM Muhyiddin's Bersatu and its allies, with Umno Pres Zahid noting that their the PM's party "have ill intentions to replace and destroy Umno."
• Zahid declared that Umno's supreme council has received the mandate to withdraw support for PM Muhyiddin's Cabinet "if there is no indication of an immediate election" and said that he believed UMNO ministers would be ready to quit if the party instructs them to do so.
• Veteran Umno MP Razaleigh called upon Cabinet ministers from Umno to step down immediately and "if they don't, this means they are not with us."
• FTSE Russell are set to announce their decision on whether they will keep Malaysian debt on their World Government Bond Index, after putting it on the watchlist. Most analysts expect Malaysian bonds to be kept on the Index, which would prevent potential $9.9bn (per CBC calculation/via BBG) worth of capital outflows.
• A break below the 200-DMA at MYR4.1374 would encourage bears to take aim at Mar 18 low of MYR4.1020. Bulls see the prior daily high of MYR4.1523 as their initial target and a move through there would bring Nov 4 high of MYR4.1745 into view.
• Malaysian trade report, due later today, headlines the local docket this week. In addition, Markit M'fing PMI comes out on Thursday.