KUALA LUMPUR, Nov 17 — The ringgit slipped further against the US dollar today, amid expectations that the Federal Reserve (Fed) may increase interest rate earlier than expected, a dealer said.
At 6 pm, the local note slipped to 4.1795/1810 versus the greenback from 4.1645/1680 at Tuesday’s close.
Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the US dollar Index (DXY) shot up to 96.183 points before reverting back to 95 points today.
“The US retail sales, revealed last night, which grew more than expected had boosted the optimism that the Fed might want to raise its policy rate earlier in order to remain ahead of the curve.
“A number of Fed officials will be speaking tonight and this could shed more light on the Fed’s direction on the Federal Fund Rate in the future,” he told Bernama.
On another note, he said the virtual summit between US President Joe Biden and Chinese President Xi Jinping appeared to have instilled some hope that the friction between the two nations could be further diffused, paving the way for risk-on mode to occur.
However for now, issues surrounding the higher inflation rate and subsequent policy action by the Fed is taking centre stage, he noted.
“The US dollar versus ringgit pairing could be moving towards its resistance level of RM4.1862.
“Nonetheless, from a technical point of view, the ringgit could be reaching the oversold position, hence there could be some buying interest given the constructive view on the Malaysian economy.
“For now, the local currency could linger at 4.16 to 4.17 per US dollar,” he added.
Meanwhile, the ringgit was traded mixed against a basket of major currencies.
The local currency strengthened versus the Japanese yen to 3.6394/6410 from 3.6464/6497 on Tuesday and rose against the euro to 4.7274/7291 from 4.7313/7353
The ringgit eased vis-a-vis the British pound to 5.6127/6147 from 5.6050/6097 and decreased against the Singapore dollar to 3.0772/0788 from 3.0755/0783 yesterday.
— Bernama
