Ringgit closes lower as the greenback strengthens

 

KUALA LUMPUR: The ringgit continued its downtrend today to end lower against the greenback for the third consecutive day ahead of a decision on US interest rate tomorrow and as Japan made its first rate hike in 17 years, an analyst said.

Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said the US Dollar Index rose 0.3% to 103.893 points ahead of the US Federal Reserve (Fed) decision on interest rates, weakening the local note.

“The focus today was also on the Bank of Japan’s (BOJ) decision to raise its overnight call rate from minus 0.1% to between zero and 0.1%.

“This followed by the decision to discontinue the purchase of exchange-traded funds and Japan’s real estate investment trusts, which is part of their quantitative and qualitative monetary policy framework,” he told Bernama.

Afzanizam said also weighing on sentiment is the US Federal Open Market Committee (FOMC) meeting which will commence tonight and end tomorrow.

“A hawkish Fed could provide further support to the dollar and therefore, the meeting will be closely monitored by the market,” he said.

At 6pm, the ringgit fell to 4.7350/4.7390 against the greenback from yesterday’s close of 4.7165/4.7195.

The ringgit was traded higher against a basket of major currencies.

It increased vis-a-vis the Japanese yen to 3.1420/3.1451 from 3.1608/3.1630 yesterday, gained against the British pound to 5.9992/6.0043 from 6.0060/6.0098 and firmed versus the euro to 5.1318/5.1361 from 5.1400/5.1433 previously.

The ringgit traded mixed against other Asean currencies.

It was lower versus the Thai baht to 13.1171/13.1354 from 13.1050/13.1203 at yesterday’s close and slipped against the Indonesian rupiah to 301.2/301.6 from 300.5/300.9.

However, the local currency edged up against the Singapore dollar to 3.5249/3.5281 from 3.5253/3.5278 and performed better against the Philippine peso at 8.46/8.48 compared with 8.49/8.50 previously. - FMT