Yes, but this has nothing to do with high or low LTV.
It is about the loaned out money doesn't flow back into deposit enough.

The market already started to price in the hike after better than expected job data which may prompt Fed to raise.

It won't wait until the day of Fed announcement of the hike, only it moves.

You can't derive the cost like that.
The dismay profit figure was being hit the impairment as well.

Aussie is not appreciating against RM too much as compared to USD or GBP.
It is those sending kids to US and UK that headache the most if not hedging or bought the currency prior before hand.
Tuition fee suddenly cost nearly 30% more.

I knew because years ago, I bought Aussie at Rm2.9x and 3.0x level before.
Last time it went as high as 3.1x to 3.20 level.

Aussie fundamental actually is much weaker than RM.

Slow growth, low interest rate (potential being cut further), current account deficit, trade balance deficit.

Yes, Sgd is one of most stable currency, but it gives almost no interest throughout.

I converted to SGD at about (about 2.50) on 2008 years ago, the interest rate was so low across, basically earn less than 2% over the 7 years period.

Today it becomes 3.05 + 2% = 3.11 worth

compared to 2.50 of RM that placed with average 3.x% now compounded (total up about 23%) now roughly worth 3.08.

I merely gain much 0.03 by holding Sgd, over the 7 years period, unless one just converted last year at about 2.6~2.7 time, then different story.

Yes, cash with no yield is "useless".

As my previous suspicious, there are a lot of short position on RM, so short seller may be scrambling to cover the short position when it surges.

The "logic" or based on pure RM's fundamental doesn't warrant to be at 4.40 level.

They should have natural hedge on both side one disregard up and down, as they earn the discrepancy between the spread.

They only will loss if greedy by betting on one side aka hoarding a currency that they see strong.

If always practice close the position, there shouldn't be "loss" over the time.
Even not manage to close the position fast enough, let say 1 day lag, over the long term, it is natural hedge back one.

Eg.
When RM plunge time, they were also no manage to close position, so they were making gain by not closing the position fast.
Now when RM rise, they loss due to the open position.

1 loss + 1 gain = 0, it cancel out each other.

Unless greedy and purpose try to be "open position" longer for some currency they see it strong.

Yes, it won't perfectly hedge, but it cancels each other out, if always practice the same discipline in term of closing position on both way.

Reuter got.

http://www.reuters.com/article/2015/11/23/...yUwc5brYzGGZ.97

RM is always moving in tandem with other currencies, just the magnitude is higher than others.

Trillions of treasuries doesn't count?

China doesn't need to sell US treasuries in order to buy emerging countries bonds, they have significant trade and current account surplus every year that provide enough funding to buy overseas bonds or asset.

A few ten of bil is nothing as compared to its foreign currencies size of USD 2-3 trillions.

But those few ten bil could prop up the China image as a good friendly and big country that emerging countries can rely upon.

Even for the first hike, Fed seems like indecisive, so likely the second hike will be distance away, I don't see this Fed is a hawkish camp.

I was talking about the hike further down the road, aka "second hike".

I guess they will hike 0.25% in the coming meeting, but pause from there.

Please create a V3 for further posting. Ty.