Although Frieda said the currency now looked cheap compared with regional peers, he couldn't see it rallying under the circumstances. "The onshore market is also illiquid, and there is no natural seller of dollars other than BNM themselves for now." Investors' immediate concern is that the foreign money in RM10.5 billion of bonds maturing in mid-March will flee. Aberdeen Asia has assets of US$3.5 billion, and its allocation to Malaysian local currency assets is approximately US$110 million. Pimco's Frieda says the currency could at some point be an attractive buy, provided there was enough liquidity to transact freely.

Source: The Edge Markets February 27, 2017 08:26 UTC