KUALA LUMPUR: The ringgit rose on Thursday, bolstered by indications from United States President Donald Trump regarding a potential trade deal with China.
At 6 pm, the ringgit strengthened to an almost two-week high of 4.4270/4320 from 4.4410/4450 at Wednesday’s close.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid interprets this development as a sign of a less hawkish stance, suggesting that Trump may take a less aggressive approach towards trade relations with China.
"Ringgit surpassed its immediate support level today. This was in tandem with the decline in the US Dollar Index (DXY) to 106.923 points.
"Other currencies also appreciated against the US dollar despite the Federal Reserve’s (Fed) indication that it would hold interest rates steady,” he said.
The minutes showed that the Fed remained unconvinced that inflation was sustainably moving towards its two per cent target despite the labour market being near full employment.
Following this, financial markets now foresee just one rate cut this year compared to two previously.
Meanwhile, the ringgit traded mostly higher against major currencies.
It strengthened against the euro to 4.6196/6248 from 4.6306/6348 yesterday and advanced against the British pound to 5.5833/5896 from 5.5965/6016.
However, it weakened against the Japanese yen to 2.9454/9490 from 2.9277/9305 previously.
The ringgit also gained against most ASEAN currencies.
It rose against the Singapore dollar to 3.3060/3099 from 3.3068/3102, the Thai baht to 13.1459/1685 from 13.1769/1946, and the Indonesian rupiah to 270.9/271.4 from 272.0/272.4.
The local unit was unchanged against the Philippine peso at 7.64/7.65 compared to 7.64/7.65 yesterday. - Bernama
