Ringgit Edges Higher In Early Trade Despite Absence Of Major Local Catalysts

Spot USD/MYR has eased off in early trade, catching up with yesterday's greenback sales. The rate last deals -55 pips at MYR4.0580, with initial bearish focus falling on Dec 18 low of MYR4.0310. A breach of that level would bring the psychological MYR4.000 level into view. On the flip side, a recoil above Dec 15 high of MYR4.0675 would open up Dec 7 high of MYR4.0885.

• Malaysian CPI deflation accelerated to -1.7% Y/Y in November, defying expectations that it will remain unchanged at -1.5%. Core inflation printed at +0.7% Y/Y.
• Malaysian Health Ministry said that it has identified a new variant of the coronavirus, "similar to a strain found in South Africa, Australia and the Netherlands." The Ministry said that it is not yet confirmed whether the new strain is any more infectious.
• Meanwhile, the Health Ministry asked residents of Selangor to avoid leaving homes unnecessarily to prevent further spread of the virus.
• Also on Wednesday, PM Muhyiddin unveiled the gov't's strategy to revive the tourism industry in 2020-30, which includes the creation of tourism investment zones, encouraging domestic travel and marketing Malaysia as an ecotourism destination.
• Nothing much left on Malaysia's economic docket this week, focus turns to trade data, due next Monday.