Ringgit Respects Weekly Range Despite Jitters Surrounding Virus & Politics

Spot USD/MYR happy to continue trading sideways this morning, sticking to this week's range. It last sits +65 pips at MYR4.0160, with the ringgit paying little attention to domestic political jitters and the deteriorating coronavirus situation.

• Infighting in Malaysia's ruling coalition continues , with two UMNO ministers pushing back against the request from UMNO party leader Ahmad Zahid Hamidi to call a snap general election. As a reminder, in November PM Muhyiddin said he would like to hold an election once the pandemic is over. Recently sacked Barisan Nasional SecGen accused UMNO leader Ahmad of informing the King that he supports Anwar Ibrahim as a candidate for PM and of plotting with DAP party to topple the gov't.
• A record high in Malaysia's Covid-19 case tally seen Wednesday was a bitter reminder about the local coronavirus situation. Director-general of Health called for targeted lockdowns in selected regions, as the health system is at a "breaking point." The Straits Times reported that the gov't could place Kuala Lumpur, Selangor, Sabah, Johor, Penang and Melaka under strict lockdowns.
• Gains past Dec 23, 2020 high of MYR4.0673 would allow bulls to target the 50-DMA at MYR4.0819. Bears need a break under Jan 4 low of MYR3.9957 to regain momentum, with the lower 3.0% Bollinger band at MYR3.9868 coming up next.
• An update on Malaysian foreign reserves is due Friday.