KUALA LUMPUR: The ringgit continued to be weighed by the rising US dollar for the fifth consecutive session as another aggressive United States (US) interest rate hike is expected this week, said an analyst.
At 6 pm, the local currency slid to 4.5495/5515 against the greenback from 4.5340/5365 at Thursday’s close.
The market was closed last Friday in conjunction with the Malaysia Day celebration.
Bank Islam Malaysia Bhd chief economist Firdaos Rosli said the local note was also pressured by firmer US retail sales and jobless claim data, which would push the US central bank to continue to adopt a tough stance against inflation. "This would allow the Federal Reserve to increase its interest rates, which could impact emerging currencies, including the ringgit,” he told Bernama.
Nevertheless, he said the local note had been strengthening against other major currencies over the past few weeks due to the country’s economic fundamentals and prospects that have remained solid amid the gradual labour market recovery.
"However, the ringgit will likely remain weak against the US dollar amid the market’s anticipation of a full percentage point hike, or at least 75 basis points during Sept 20-21 meeting,” he said.
As such, he reckons that the local note would trade between RM4.55 and RM4.57 against the US dollar this week.
Meanwhile, the ringgit was traded mostly lower against a basket of major currencies.
It went down against the euro to 4.5372/5392 from 4.5317/5342 at Thursday’s close, depreciated versus the Singapore dollar to 3.2261/2278 from 3.2238/2261, and declined against the Japanese yen to 3.1706/1724 from 3.1647/1666 previously.
However, the local note gained against the British pound at 5.1678/1700 from 5.2214/2242 last week. - Bernama
