Ringgit slips against US dollar ahead of key US inflation data, ends mostly higher

KUALA LUMPUR, Aug 11 — The Malaysian ringgit closed higher today versus most major currencies, yet weakened against the US dollar prior to forthcoming US inflation data. By 6 pm, the ringgit fell to 4.0905/0940 against the US dollar, down from yesterday's close of 4.0885/0930. Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid noted that the approaching US Consumer Price Index (CPI) data on Wednesday would serve as a key market indicator to assess the trajectory of US interest rates.

Combined with a seemingly less robust US labor market, this implies that demand-driven inflation may not be the primary driver of price pressures, Rashid explained to Bernama. He argued that monetary tightening might not be an effective policy to bring US inflation down towards its 2% target. The local currency ended mostly stronger against a basket of major currencies at the day's close.

It strengthened against the Japanese yen, rising against the euro, but slipped against the British pound. Additionally, the ringgit improved against regional currencies, including the Singapore dollar, Thai baht, Philippine peso, and Indonesian rupiah.