Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said given that some Republican congress members seem not agreeable to the current deal, the risk of a delay in the decision-making is something markets cannot completely rule out.
At 6pm, the local currency was weaker at 4.6105/4.6155 against the US dollar from Tuesday’s close of 4.6005/4.6045.
Afzanizam said foreign exchange market participants have become defensive, leading to higher demand for the US dollar.
“So, the voting tonight will be a closely watched event as this will determine whether the stalemate can be resolved amicably,” he told Bernama.
He believes the US dollar/ringgit is likely to stick at the RM4.60 level as there is a lack of conviction on the US debt limit impasse.
At today’s close, the ringgit was mostly higher against a basket of major currencies.
It rose vis-a-vis the British pound to 5.6986/5.7048 from 5.7129/5.7179 at the close on Tuesday, increased against the euro at 4.9208/4.9261 from 4.9327/4.9369 but fell against the Japanese yen to 3.2951/3.2989 from 3.2821/3.2852 yesterday.
At the same time, the local currency traded mostly lower against other Asean currencies.
It depreciated versus the Indonesian rupiah to 307.4/307.9 from yesterday’s close of 306.9/307.4, slipped vis-a-vis the Thai baht to 13.2440/13.2641 from 13.2251/13.2427, and slid against the Philippine peso to 8.20/8.22 from 8.16/8.17 previously.
However, the ringgit was flat at 3.4036/3.4075 against the Singapore dollar from 3.4035/3.4070 previously. - FMT
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