How did Malaysia's central bank manage to simultaneously meddle in markets to support its currency and increase its foreign exchange reserves? That's a $500 million question.
Malaysia's central bank, Bank Negara Malaysia (BNM), said last week it was intervening in the market to support the ringgit, which was particularly hard hit in the "Trump tantrum" of emerging market fund outflows in the wake of Donald Trump's surprise U.S. election win on Nov. 8.
That intervention should have showed up in the country's foreign-exchange reserves as a decline because the central bank would usually need to sell foreign currencies to purchase ringgit.
Instead, the central bank said on Tuesday that its international reserves amounted to 407.8 billion ringgit, equivalent to $98.3 billion, as of Nov. 15. That compared with the 405.5 billion ringgit, or $97.8 billion, it had as of October 31, according to a November 7 statement.
At least one analyst noted the seeming discrepancy in the figures.
"A surprise increase in foreign-exchange reserves and BNM reassuring investors that capital markets and the banking system is deep and liquid in their policy statement leaves more questions than answers," Jason Daw, a foreign-exchange analyst at Societe Generale, said in a note on Thursday.
"Valuation effects alone should have caused reserves to fall and it is unlikely that dollar buying occurred in the November 1-15 period," he said, speculating that Malaysia's swap line with China's central bank, the People's Bank of China (PBOC), may have been tapped for dollar liquidity.
The swap arrangement allows the two central banks to provide liquidity in each other's currencies, primarily aimed at supporting trade and investment.
Daw noted that Malaysia has "significant resources" to manage any stress from outflows, such as the PBOC swap line, a Chang Mai swap line and IMF credit facilities. But he added that "sentiment has been damaged and the ringgit should remain on edge."
"Reassuring words alone will be insufficient to change the trend," he added.
For the ringgit, the trend since the U.S. election results has been unremittingly negative. By Thursday, dollar climbed as much as 6.5 percent against the Malaysian currency for the month so far, with the greenback fetching as much as 4.4630 ringgit, its highest since September 2015 and flirting with levels last seen during the Asian Financial Crisis in 1997.
Sentiment on the ringgit was also hurt by the central bank's warning to foreign banks to restrict trading in offshore non-deliverable forwards (NDFs) on the currency, which have fallen further than the spot rate.
While that moved appeared to be only a reinforcement of existing regulations, it spooked traders. markets tend to be more sensitive to tea-leaf reading over capital controls in Malaysia because the country was the first to impose them during the Asian Financial Crisis.
For its part, BNM appeared to stand behind its figures. In an emailed response on Friday to an earlier request for comment, it said, "As clearly indicated in the statement released on 22 November 2016, the international reserves position of Bank Negara Malaysia as at 15 November 2016 reflects transactions that transpired throughout the first half of the month. The fortnightly international reserves position is compiled consistently and strictly in accordance to the standards prescribed by the International Monetary Fund."
There may be other factors that might explain why the reserves figures rose.
Julian Wee, a senior markets strategist for Asia at National Australia Bank, noted via email on Friday that BNM announced its intervention on Nov. 18, while the reserves data cut off on Nov. 15.
"It wasn't clear what period of time it was referring to. The November 1-15 data suggests that they were not selling dollars, given that valuation effects might even have been negative," he said, noting that the dollar index, which measures the greenback against a basket of currencies, climbed during that period.
"It's possible that BNM did absorb some flows," he added, noting that the BNM data showed deposits placed by financial institutions rose, although it wasn't clear what drove the increase.
Wee noted that the ringgit's status as the worst performer among emerging Asia currencies suggested that the BNM undertook a "deliberate policy decision" to conserve its foreign-exchange reserves.
—By CNBC.Com's Leslie Shaffer; Follow her on Twitter