KUALA LUMPUR: The ringgit continued its downtrend today to end lower against the greenback due to continued positive sentiment for the US dollar, which was bolstered by strong United States retail sales data in March amid concerns over the Middle East tension, said an analyst.
At 6 pm, the ringgit fell to 4.7945/7970 against the US dollar from Monday’s closing of 4.7785/7815.
The US retail sales rose 0.7 per cent in March to US$709.6 billion after February’s increase was revised to 0.9 per cent.
Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the strong US retail sales data suggest that the anticipation of the US rate cut by the Federal Reserve has diminished.
"This certainly has led to higher demand for the US dollar which saw the US Dollar Index (DXY) rose 0.16 per cent to 106.373 points,” he told Bernama.
He also noted that concerns over the Middle East tensions would exert pressure on emerging market currencies as demand for safe haven currencies such as the US dollar is higher.
"A combination of strong US economic data and market moving event are the key factors driving the currency market at the moment,” he added.
At the close, the ringgit was traded mostly lower against a basket of major currencies.
It shed against the euro to 5.0966/0992 from 5.0915/0947 at Monday’s close, weakened versus the British pound to 5.9701/9732 from 5.9660/9697 but was better vis-a-vis the Japanese yen to 3.1020/1038 from 3.1053/1075 yesterday.
However, the ringgit was traded mixed against ASEAN currencies.
It was lower versus the Thai baht at 13.0858/13.0983 compared with 13.0148/13.0286 at Monday’s close, depreciated against the Singapore dollar to 3.5135/5156 from 3.5123/5148 yesterday, but was flat versus the Philippine peso at 8.41/8.42 and stronger vis-a-vis the Indonesian rupiah to 296.3/296.6 from 301.4/301.8 previously. - Bernama
