The US blockade of the Strait of Hormuz has raised concerns over oil and gas supply shortages and inflation, says analyst.
Reports said that US-Iran negotiations failed to reach an agreement on Sunday after hours of talks in Islamabad, Pakistan, prompting US president Donald Trump to announce a blockade of the Strait of Hormuz.
Subsequently, the US Central Command announced that it will implement a blockade of all maritime traffic entering and exiting Iranian ports on April 13 at 2pm.
Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said the stalled US-Iran talks over the weekend and the planned blockade of the Strait of Hormuz have raised concerns over potential oil and gas supply shortages, which may further pressure inflation.
“The subsequent announcement by Trump to block the Strait of Hormuz has resulted in concern that the shortages in oil and gas supplies will exert further pressure on inflation going forward,” he told Bernama.
At the time of writing, the Brent crude oil price rose by 7.28% to US$102.24 (RM406.40) per barrel.
At 6pm, the local currency slid to 3.9735/3.9805 against the US dollar from 3.9625/3.9680 at last Friday’s close.
At the close, the ringgit traded mostly lower against a basket of major currencies.
It decreased against the British pound to 5.3360/5.3454 compared with 5.3248/5.3322 and weakened against the euro to 4.6434/4.6516 from 4.6401/4.6465, while it improved against the Japanese yen to 2.4875/2.4920 from 2.4882/2.4918 at last Friday’s close.
At the same time, the local currency traded mixed against Asean currencies.
It slipped versus the Singapore dollar to 3.1145/3.1205 from 3.1093/3.1139 and was down against the Indonesian rupiah to 232.2/232.8 from 231.6/232.0.
Meanwhile, the local currency rose against the Thai baht to 12.3202/12.3503 from 12.3289/12.3525, while it was flat against the Philippine peso at 6.60/6.62. - FMT
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