Ringgit ends slightly higher versus greenback after less hawkish remarks by Fed chairman

  • Forex
  • Wednesday, 08 Feb 2023

KUALA LUMPUR: The ringgit ended slightly higher against the US dollar today on higher oil prices and as more investors shifted their interest towards emerging currencies after less hawkish remarks on interest rates from the US Federal Reserve (Fed) chairman, said an analyst.

At 6 pm, the ringgit ended the day at 4.2960/3005 against the greenback from Tuesday’s close of 4.2995/3055.

At the time of writing, Brent crude gained 1.18 per cent to US$84.68 per barrel.

SPI Asset Management managing director Stephen Innes told Bernama that the ringgit benefited from an overnight speech by Fed chairman Jerome Powell which was seen as less hawkish than markets had anticipated it to be after the strong US non-farm payrolls report recently.

Juwai IQI chief economist Shan Saeed said the ringgit is set to remain stable for the week and should move around 4.28 to 4.32 to the greenback.

"We at Juwai IQI foresee the US dollar losing its strength by April and May and that the Fed will decrease interest rates by October to ward off recessionary fears in order to support the US economy.

"The ringgit’s movement in 2023 should be between 4.10 and 4.30 and it will maintain its structural stability against major currencies,” he added.

Putra Business School associate professor Dr Ahmed Razman Abdul Latiff said even though the ringgit has strengthened considerably against the US dollar for the past month, from 4.40 one month ago to about 4.30 today, the uptrend will likely continue, albeit slowly and cautiously.

"This is due to the signal given by the Fed that the interest rate will see further hikes but more slowly than before as the inflation rate in the US remains high at more than 6 per cent even though it is (declining),” he added.

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

The local note inched down against the Singapore dollar to 3.2472/2511 from Tuesday’s close of 3.2420/2470 and weakened vis-a-vis the Japanese yen to 3.2872/2909 from 3.2624/2672.

It depreciated against the British pound to 5.1990/2045 from 5.1624/1696 and fell versus the euro to 4.6203/6252 from 4.6065/6129. - Bernama

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