KUALA LUMPUR, March 15 — The ringgit opened slightly weaker against the stronger US dollar after the latest strong economic data amidst rising inflationary pressures further suggesting that the Federal Reserve (Fed) is on track to gradually remove the monetary policy accommodation.
At 9 am, the local currency declined to 4.2055/2090 versus the greenback from 4.2050/2075 at Monday’s close.
Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the 10-year US Treasury yields had surpassed the 2.0 per cent mark and currently hovering at 2.13 per cent.
‘’This happened as the Federal Open Market Committee (FOMC) members will deliberate in their decision on March 16, whereby a 25-basis-point hike in the Fed Fund Rate (FFR) is almost a foregone conclusion.
‘’This development will lend support to the US dollar and would make other currencies to depreciate,’’ he told Bernama.
Additionally, the uncertainties surrounding the Russia-Ukraine military conflict provides the right incentives for investors to stay light and remain liquid.
‘’We expect the ringgit to stay within RM4.20. However, the higher Brent crude may limit the extent of ringgit weaknesses, given that it may benefit the country’s economy,’’ Mohd Afzanizam noted.
The ringgit was traded stronger against a basket of major currencies.
It appreciated against the Japanese yen to 3.5577/5609 from 3.5666/5690 at Monday’s close and climbed against the British pound to 5.4714/4759 from 5.4846/4878.
The local unit rose to 4.6054/6093 vis-a-vis the euro from 4.6184/621, and strengthened against the Singapore dollar to 3.07679/0797 versus 3.0815/0838 on Monday.
— Bernama
