Ringgit weakens amid ongoing trade war concerns

 

KUALA LUMPUR: 

The ringgit closed weaker against the US dollar today, weighed down by cautious market sentiment following reports of a 104% tariff imposed on China, indicating the likelihood of a prolonged trade war.

Bank Muamalat Malaysia Bhd chief economist Afzanizam Abdul Rashid said tit-for-tat trade actions could worsen the situation, as the US tariffs raise both business and living costs, ultimately weighing on global economic growth.

“We can safely say that the main focus among central banks is how monetary policy could be used to steer the economy, with, for example, sustaining growth as the immediate priority,” he told Bernama.

Afzanizam emphasised the significant uncertainty regarding whether global economies can reach an agreement with the US or will encounter a more aggressive approach.

He added that this fluid situation is likely to keep currency markets highly volatile in the near term.

At 6pm, the local currency stood at 4.4935/4.4990 against the greenback, compared to yesterday’s closing of 4.4885/4.4930.

Meanwhile, the ringgit traded weaker against major currencies today.

It fell against the Japanese yen to 3.0921/3.0964 from 3.0501/3.0533, slipped against the euro to 4.9640/4.9700 from 4.9005/4.9055 and decreased against the British pound to 5.7629/5.7700 from 5.7210/5.7268 yesterday.

The local note traded mostly lower against Asean currencies.

It slid versus the Thai baht to 12.9915/13.0153 from 12.8898/12.9094 and edged down against the Indonesian rupiah at 266.3/266.7 from 265.7/266.1.

The ringgit was weaker against the Singapore dollar at 3.3349/3.3395 from 3.3224/3.3259 previously and it was almost flat against the Philippine peso at 7.83/7.85 from 7.83/7.84. - FMT