INSIDE MALAYSIA: Ringgit Falls; Benchmark Rate on Hold

By Yidi Zhao

May 16 (Bloomberg) -- Ringgit weakens for second day, dropping 0.2% to 3.0066 per dollar; pivot point at 3.0097; resistance at 2.9971, 2.9749, 2.9401; support at 3.0319, 3.0445, 3.0793.

* Nation’s GDP rose 4.1% in 1Q, trailing median forecast for 5.5% expansion in Bloomberg survey; data released after local financial markets closed for trading yesterday

* Prime Minister Najib Razak announced new ministerial line-up yesterday

* BNM’s mandate is to ensure “orderly functioning” of foreign-exchange markets: Governor Zeti Akhtar Aziz; says central bank doesn’t rely on overall trend in currency to achieve stronger growth

* Currency approaching 23.6% Fibonacci retracement of rally from June through May 8 at 3.0001

* Given benign inflation readings, risk of weaker growth in coming quarters could open door for BNM to consider monetary easing, Bank of America Merrill Lynch says in note; maintains view BNM will stay on hold this year

* Societe Generale sees upside pressure on USD/MYR and NDF