Ringgit retreats on profit-taking as hopes for US rate cut fade

 

KUALA LUMPUR: 

The ringgit closed lower against the US dollar today on profit-taking after recent sharp gains, in line with other regional currencies, as the US signalled a lower interest rate cut going forward.

Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid attributed the weaker performance to the latest remarks by US Federal Reserve (Fed) chairman Jerome Powell, who reassured markets that monetary easing would continue but that the Fed is not in a hurry to cut rates quickly.

Afzanizam said he expects the Fed to maintain its usual pace of a quarter-point rate cut at its upcoming meeting next month against previous expectations of another 50 basis points slash.

“With the ringgit having appreciated sharply in recent days, traders took the chance to secure some profit. 

Additionally, heightened geopolitical risks in the Middle East could increase demand for safe-haven currencies like the US dollar,

 he told Bernama.

At 6pm, the ringgit traded at 4.1530/4.1610, down from yesterday’s close of 4.1210/4.1280.

The ringgit traded mostly higher against a basket of major currencies, except for the British pound, where it weakened to 5.5335/5.5441 from 5.5193/5.5260.

It gained against the Japanese yen, closing at 2.8892/2.8950 compared to yesterday’s 2.8899/2.8936, and also strengthened against the euro, ending at 4.6078/4.6166 from 4.6106/4.6162.

Against Asean currencies, the ringgit mostly traded lower, except for the Thai baht, where it rose to 12.7412/12.7716 from 12.8037/12.8248.

It declined against the Indonesian rupiah, dropping to 273.1/273.7 from 272.1/272.6, slipped against the Singapore dollar to 3.2269/3.2334 from 3.2175/3.2217 and fell against the Philippine peso to 7.39/7.41 from 7.35/7.37. - FMT