KUALA LUMPUR, Nov 11 — The ringgit ended lower against the US dollar today, in line with other regional currencies, said an economist.
At 6 pm, the local note was weaker versus the greenback at 4.1690/1720 from 4.1525/1545 at Wednesday’s close.
Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the persistent increase in inflation in the United States to 6.2 per cent in October suggests that a higher price level may not necessarily be a temporary phenomenon as has been suggested by the US Federal Reserve chairman Jerome Powell.
“As such, we shall expect a change in their tact to anchor inflation expectations as indicators from labour markets indicate that the US citizen is likely to accelerate their spending habit.
“Such dynamics would boost the US dollar value and this has been reflected by the sharp increase in the US Dollar Index (DXY) which has hovered a tad lower from 95 points,” he told Bernama.
Mohd Afzanizam said in light of this, US dollar-to-ringgit would move closer to the current resistant level of RM4.1862.
Nevertheless, from a technical point of view, the local note is reaching towards being oversold against the greenback.
“Perhaps, once the market has a full grasp on the impact of higher inflation on monetary policy, the demand for ringgit should come in. But for now, the ringgit would (continue) to lean towards the weaker side,” he added.
At the close, the ringgit was traded higher against a basket of major currencies.
Against the Japanese yen, it increased to 3.6545/6574 from 3.6683/6704 previously and rose vis-a-vis the British pound to 5.5835/5876 from 5.6208/6235 at Wednesday’s close.
The local note also appreciated against the Singapore dollar at 3.0754/0781 from 3.0816/0833 and improved against the euro at 4.7798/7832 from 4.8078/8101.
— Bernama
