KUALA LUMPUR – The ringgit rose against the US dollar today, reinforcing expectations that it will hit 4.50 versus the greenback by year end, according to Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid.
At 6pm, the ringgit firmed to 4.6625/6660 against the US dollar from yesterday’s closing of 4.6745/6790.
“The anticipation of an eventual interest rate cut by the US Federal Reserve seems to dominate market sentiment. The softening in economic data and the ongoing disinflationary trend have made the case for monetary easing by the Fed more compelling, leading to a weaker US dollar,” he said.
The US Dollar Index has trended down to 103.796, declining by 0.45%.
“There is a possibility for us to revise the current year-end target of RM4.65. Initially, in the first quarter of this year, we had been looking at RM4.50; we might revisit the target due to positive developments,” he said.
The economist also said the odds for a September rate cut by the Fed had risen sharply, and the members of the Federal Open Market Committee might be “more explicit” in signalling their intention to do so in their meeting at the end of this month.
The ringgit eased against a basket of major currencies.
It fell versus the Japanese yen to 2.9809/9834 from 2.9503/9534 at yesterday’s close, weakened against the British pound to 6.0813/0859 from 6.0614/0673 yesterday and slipped vis-a-vis the euro to 5.1022/1060 from 5.0938/0987 previously.
The local note traded mostly lower against Asean currencies.
The ringgit dropped against the Singapore dollar to 3.4810/4839 from 3.4783/4819 at yesterday’s close, inched down versus the Indonesian rupiah to 289.5/289.9 from 288.8/289.3 previously, and depreciated vis-a-vis the Thai baht to 12.9918/13.0070 from 12.9459/9634.
However, it went up against the Philippine peso to 7.99/8.00 from 8.00/8.01 yesterday. – July 17, 2024