26/06/2022

THAILAND DAILY

NEWSPAPER / MAGAZINE / PUBLISHER

ringgit-eases-against-us-dollar-in-early-session

Ringgit eases against US dollar in early session

KUALA LUMPUR,. The ringgit continued to remain weak in the early session today amidst expectations that the United States (US) Federal Reserve (Fed) would raise its interest rates in its upcoming meeting in early May, said an analyst.

At 9am, the local note, which slipped to a 22-month low at the close yesterday, had weakened further to 4.2830/2890 versus the US dollar from 4.2800/2830 yesterday.

Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said he expects the ringgit to trade in a narrow range today as market participants focus on the Fed’s next move.

“Tonight, Fed chair Jerome Powell will speak as a guest panellist at the International Monetary Fund’s seminar. Chances are he will want to reiterate the Fed’s stance on its monetary tightening.

“Meanwhile, there seems to be an expectation that the inflation rate might reach its peak soon, however, it might be too early to tell,” he told Bernama.

Mohd Afzanizam added that supply disruptions caused by the lockdowns in various parts of China would exert pressure on prices as it might affect the delivery of important parts across the globe.

“This is in addition to the ongoing military conflict that led to elevated commodity prices.

“In a nutshell, the forex market can be very edgy due to heightened uncertainties. Along the way, forex market players might seek refuge in safe-haven currencies such as the US dollar,” he added.

Market participants would also keep their eyes on Malaysia’s consumer price index for March, due to be announced tomorrow.

Meanwhile, SPI Asset Management managing partner Stephen Innes said the domestic unit would get a little reprieve today as the US bond yields slipped and the US dollar was a touch weaker versus the Japanese yen.

“That said, the yuan ― to which the ringgit has a strong correlation ― could stay weak if the People’s Bank of China (PBoC) continues to guide the yuan weaker to increase exports.

“Ideally, the ringgit would do better if the PBoC cut interest rates to stimulate domestic growth and imports. That hasn’t happened,” he told Bernama.

Meanwhile, the ringgit was traded mixed against a basket of major currencies.

The local note rose versus the Japanese yen to 3.3427/3476 from 3.3432/3458 yesterday and increased against the euro to 4.6415/6480 from 4.6468/6501 previously.

However, it had depreciated against the Singapore dollar to 3.1380/1426 from yesterday’s close of 3.1371/1398 and decreased vis-a-vis the British pound to 5.5910/5989 from 5.5781/5820 previously. ― Bernama

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