what happen, drop to 4.35 already

MR_alien, here you go....the "after event analysis" I talked about. There are always many "explanations" to everything   

1) Mr Mackel is contradicting himself when he commented in the following ways :-
a) He said the local unit was expected to be relatively stable at 4.40 against the US dollar,...
b) However, against the emerging market currencies, it would post a stronger performance, he said.

Emerging Markets Lost $735 Billion in 2015, More to Go, IIF Says

“Countries with large current-account deficits, high levels of foreign-exchange corporate indebtedness and questionable macro policy frameworks would come under particular pressure in the event of further emerging-market retrenchment," the IIF report said. "At-risk countries include Brazil, South Africa and Turkey."
http://www.bloomberg.com/news/articles/201...-to-go-iif-says

RM appreciates during malaysia office hours. Has been the case recently

When it ends and no more magic, RM will go beyond 4.45 

So,... did BNM increase the OPR this evening ? I highly doubt so....

Bank Negara lowers SRR
The SRR refers to a regulation that requires commercial banks to have an amount of funds kept with the central bank, interest-free, and used to manage liquidity in the banking system. This would be the first time the central bank has adjusted the SRR since July 2011.
http://www.thestar.com.my/business/busines...ara-lowers-srr/

Reducing SRR increase the supply of RM in the market. In this case, there will be an extra RM40b supply in the market. All else being equal, this move may lower the price of RM (in short term) according to the law of supply and demand

On the other hand, when there are extra RM in the market, it may stimulate the economy (on longer term). It has the same effect as reducing the interest rate, which should push down the value of RM in short term, but good for the economy (and hence RM) in the long term

So, the SRR move should have depreciated RM more in short term. But we witness today that the RM, once again, defied economic theories and gravity and flew up instead

You brought up the SRR as the reason of RM appreciate today. But "all else being equal", RM shouldn't perform this way today. The rise of RM were attributable to some other reasons.

I did not defy everything, you are the one who is defying economic theories 

Why the OCBC fella should be sacked ? He is just predicting a figure which could be right or wrong. Remember most of the people here (including myself) laughed at Hong leong bank analyst when he/she predicted RM will rise back to 4.20 when RM was depreciating like falling stone to 4.45 ? He/she was actually right ! 

I am just pointing out your view contradicts the law of supply and demand. If you believe what you believe, it is perfectly alright to me. I always accomodate different views. I don't force my view unto others. I hope you can accommodate my view and give it a little thought as well

Reducing SRR increase or decrease the supply of RM ?
Yes, RM defied law of economics as we have seen in many occasions over the recent months. When the behaviour of RM cannot be explained by the textbook, then it must be something extraordinary happening behind the scene. For dramatic purpose, I termed it "magic" and "hidden hands". Actually everything is about the market demand and supply. We just didn't know what action taken by the "players" 

SRR injected about 5-6 billion extra liquidity to banks, which is insignificant to move RM in such today magnitude.
Also with more liquidity, lower interest rate could be for interbank rate, which actually is a negative factor for RM in forex market.

It is more about world financial movement direction, which coincide the SRR cut, as well as oil price surging in a big magnitude.
Every currency is surging against USD in today movement, just how many % only.
RM was one hardest hit previously, so with bouncing theory, it should bounce more during reversal. 

Mind that, RM vs Sgd or even AUD, still stand above 3 level.

Foreign investors sold a net $7 billion of Malaysian equities and bonds in 2015, and were net sellers of shares in the first two weeks of this year, according to central bank figures. Bank Negara said Thursday it had pumped 40 billion ringgit ($9.3 billion) into the banking system via monetary operations including the reverse-repurchase facility since early 2015 as "net external outflows reduced the amount of liquidity in the system."

The statutory reserve requirement cut will add 6.2 billion ringgit to the system, according to estimates from Credit Suisse Group AG. There’s a risk that if the market interest rate structure is too low, it could result in further capital outflows, which could be negative for the ringgit, Singapore- based analyst Michael Wan wrote in a report Friday.

“The cut in the statutory reserve requirement played a part in the falling swaps, which basically reflects the shift in sentiment toward a bias for some easing,” Mizuho’s Varathan said.
http://washpost.bloomberg.com/Story?docId=...JMR9911HF8H60ON

I have been slowly increasing the ratio of RM from 80:20 to lower. Hopefully I can get beyond the 50:50 before it is too late 

Not bloomberg, but just an analyst's view. As usual, analysts pick and choose economic theory that fit into his "after event analysis". The very same theory could be used in the opposite position when "the need" arises in the future. We have seen too many times about these "after event analysis". Everything is explanable 

5-6 billion SRR extra liquidity added is in RM or local banking system.
The extra liquidity may opt to invest abroad, or convert to Sgd/Usd as some forumers here wish to, which may create selling factor for RM which is negative factor for RM.

Sale of asset to overseas, foreign currency needs coming in to pay for the bill, which created more demand for RM. A positive factor for RM.

Bank Negara Malaysia (BNM) Governor, Tan Sri Dr Zeti Akhtar Aziz, said Malaysia used to be an export-led economy in the 1990s but it is no longer so.

http://www.nst.com.my/news/2016/01/123589/...fforts-economic

Implying in the long term, there could only one direction for myr to move.

"It was driven by domestic demand for more than a decade that saved us. This is why we have five to six per cent growth, even in the aftermath of the global financial crisis. It is because even though our trade contracted, our domestic demand drove our growth," Zeti said in an interview on The CNBC Conversation conducted in Hong Kong at the Asian Financial Forum. The interview was conducted by CNBC Asia's Bernard Lo. To a question that Malaysia did not get enough exposure on its economic restructuring, Zeti said: "I believed that Malaysia, including BNM, would make every effort to do so." "But another factor is that we are a country that hasn't borrowed significantly from the international capital markets," she said.
Read More : http://www.nst.com.my/news/2016/01/123589/...fforts-economic

USD-MYR 4.2700  -0.0228  -0.53%

BNM closed also figure on myr side

yes, i am of the view today's srr cut led to improved liquidity->incr confidence->incr fx inflow->lower mgs yield, rm appr.

add oil price +7% within 24 hours has an effect too.

MIDF Research also noted that the ringgit was the biggest gainer among Asian currencies last Friday, up 2.07% against the US dollar. This was also its biggest one-day gain against the greenback since June 21, 2010.

“The ringgit was clearly buoyed by Bank Negara Malaysia’s decision to reduce the statutory reserve ratio, which we estimate will release RM6.2 billion into the banking system,” MIDF Research commented.
http://www.theedgemarkets.com/my/article/f...est-four-months

I think change-over half of what we have positioned for today. Then if it drops further tmrw,... change over the rest.

Then watch for Thursday,....