Risk-off mode drags ringgit lower at closing

 

KUALA LUMPUR: The ringgit ended lower against the US dollar as the first rate cut by the US Federal Reserve (Fed) is seen to be the primary driver for the risk-off sentiment.

Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid noted that the local currency was fairly stable at around RM4.712.

He said nevertheless, the timing of the first rate cut by the Fed will be the primary driver for the risk-off mode.

“The incoming economic data from the US will also play a role should it continue to outperform the market expectation, as the Fed might not be in a hurry to cut the rates.

“As such, the ringgit is expected to see cautious trading in the near- term,” he told Bernama.

The US retail sales data came in stronger than expected, supporting the Fed official’s recent hawkish tone that the central bank will keep rates higher for longer.

At 6pm, the ringgit eased to 4.7165/4.7215 versus the greenback from yesterday’s close of 4.7145/4.7200.

Meanwhile, the ringgit was traded mostly higher against a basket of major currencies.

It was lower versus the euro at 5.1339/5.1394 from 5.1284/5.1344 at yesterday’s close but appreciated vis-a-vis the British pound to 5.9782/5.9845 from 5.9799/5.9868 and strengthened against the Japanese yen to 3.1903/3.1939 from 3.1919/3.1959 previously.

At the same time, the local currency was traded mostly lower against Asean currencies.

It went up against the Thai baht to 13.2475/13.2675 from 13.2795/13.3010 at the close yesterday but weakened against the Singapore dollar to 3.5098/3.5141 from 3.5081/3.5127 previously.

It also declined vis-a-vis the Philippine peso to 8.45/8.46 from 8.43/8.45 yesterday and slipped versus the Indonesian rupiah to 301.8/302.3 from 301.3/301.8 previously. - FMT