Selangor Journal
Image for illustration purposes only. — Picture by BERNAMA

Ringgit breaches RM2.99 level against Japanese yen

KUALA LUMPUR, May 21 — The ringgit breached the RM2.99 level against the Japanese yen last seen in June 2015 in early trade today.

At 9am, the pair stood at 2.9984/3.0012. Subsequently, the ringgit traded at 3.001/0022 versus the yen at 10.42am.

Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid told Bernama the sizeable interest rate differentials with Japan’s rate may have given the ringgit an advantage.

He said Japan’s first-quarter gross domestic product 0.2 per cent contraction suggested the scope of higher policy rates by policymakers looks limited and may further benefit the ringgit.

UOB Kay Hian Wealth Advisors head of investment research Mohd Sedek Jantan said yesterday Japanese policymakers are buying fewer government bonds, which could indicate a shift in approach.

“There is speculation they might raise interest rates by 0.1 per cent by the end of July based on swaps trading,” he said, which depends on the Bank of Japan’s confidence about reaching its 2 per cent inflation target.

The Japanese currency has endured a prolonged fall, hurting domestic consumption amid higher import costs.

Japanese Finance Minister Shunichi Suzuki earlier today said he was concerned about the negative implications of the yen’s current weakness.

— Bernama

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