KUALA LUMPUR, April 20 — The ringgit traded easier against the US dollar this morning on the back of cautious market sentiment as to whether the US Federal Reserve (Fed) would raise its interest rates in the upcoming meeting in early May, said an analyst.
At 9.02am, the local note slipped to 4.2725/2775 versus the US dollar from 4.2505/2515 at Monday’s close.
Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said St Louis Fed president James Bullard has indicated that 75 basis points hike in interest rates could be the case in the next meeting.
“This has sent the US Dollar Index to 100.987 points which has been above 100 points for five consecutive trading days.
“The US dollar to ringgit (exchange rate) has flirted at around at its resistant level of RM4.2762 and judging from the technical indicators, the ringgit has already been at the oversold position. As such, the ringgit should stay around RM4.27 at the moment,” he told Bernama.
Meanwhile, SPI Asset Management managing partner Stephen Innes expects the ringgit to stay in a defensive mode, given yet another shift higher in US yields and no apparent shift in Chinese policymakers’ strict zero-COVID-19 measures.
Meanwhile, the ringgit was traded mostly lower against a basket of major currencies.
It depreciated against the Singapore dollar to 3.1236/1275 from Monday’s 3.1228/1240 but rose versus the Japanese yen to 3.3046/3087 from 3.3569/3579.
The local unit decreased vis-a-vis the British pound to 5.5624/5689 from 5.5303/5316 and dipped against the euro to 4.6130/6184 from 4.5867/5878.
— Bernama
