KUALA LUMPUR: The ringgit ended firmer against the greenback on Monday ahead of an expected US interest rate cut this week amid the heightened uncertainties over the US presidential election tomorrow, said an economist.
At 6 pm, the local note rose to 4.3715/3765 against the greenback from Friday’s close of 4.3780/3835.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the weaker-than-expected non-farm payroll data released last Friday, along with a weak ISM Index for the manufacturing sector, suggested that the US labour market is softening. He said the situation has reinforced the case for monetary easing by the US Federal Reserve (Fed) as lowering borrowing costs is essential to promote consumption and investment.
The Fed is widely expected to cut interest rates by 25 basis points on Thursday.
"All eyes are now on the US presidential election on Tuesday. Should Donald Trump prevail, it could mean more tariffs, tax cuts and massive deportation of illegal immigrants. All these may be inflationary which could result in the Fed revisiting their monetary easing strategy going forward,” he told Bernama.
At the close, the ringgit was lower against a basket of major currencies.
It fell vis-a-vis the British pound to 5.6707/6772 from Friday’s close of 5.6502/6573, depreciated versus the Japanese yen to 2.8775/8810 from 2.8652/8690 and slid against the euro to 4.7636/7691 from 4.7532/7592.
The local note traded mixed versus ASEAN currencies.
It appreciated against the Indonesian rupiah to 277.5/277.9 from 278.2/278.7 but eased vis-a-vis the Singapore dollar to 3.3185/3226 from 3.3054/3098 and weakened against the Thai baht to 12.9664/9882 from 12.9103/9322.
The ringgit was flat against the Philippine peso at 7.49/7.50 from Friday’s close of 7.49/7.51. - Bernama
