The ringgit was set to suffer today its biggest two-day slide since the 1997-98 Asian financial crisis as tumbling oil prices threatened to undermine the oil exporter’s economy.

The ringgit fell 2.4% to RM3.43 per US dollar as as 2.53pm from Thursday’s close of RM3.3465, according to Thomson Reuters data.

Earlier today, the Malaysian currency slipped as far as RM3.4375, its weakest since February 2010.

That would be the largest two-day depreciation since July 1998, the data showed. In 1998, Malaysia fixed the ringgit at RM3.80 and abandoned the peg in July 2005.

Malaysian stocks lost nearly 3% after Petroliam Nasional Bhd (Petronas) said on Friday it plans to cut capital expenditure next year by 15-20%.

“It just adds to the negatives,” said Jonathan Cavenagh, senior FX strategist with Westpac in Singapore. “I suspect until oil stabilises, the ringgit is at risk of continuing to fall.”

The ringgit may weaken to RM3.45 and the next target would be RM3.47-3.50, Cavenagh said.

Oil prices hit five-year lows, unable to find a bottom despite their biggest fall in 2½ years last week as OPEC held back from cutting output in the face of a supply glut.

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