Ringgit gains against major currencies, slips slightly against US dollar

KUALA LUMPUR, Aug 13 — The Malaysian ringgit opened higher against major currencies on Thursday, but softened against the US dollar amid a slowdown in the much-anticipated US Consumer Price Index (CPI). At 8am, the currency fell to 4.0850/0950 against the US dollar from yesterday's close of 4.0835/0875. Dr Mohd Afzanizam Abdul Rashid, chief economist at Bank Muamalat Malaysia Bhd, pointed out that US CPI inflation moderated to 3.4 percent in July from 3.5 percent the previous month.

"The actual outcome aligned with market expectations. The 10-year US Treasury yields dropped below 4.70 percent, indicating a reduction in the inflation premium, while the two-year note yield fell by one basis point to 4.20 percent, implying the Federal Reserve may not rush to raise interest rates," he informed Bernama. He also noted that concerns over the reopening of the Straits of Hormuz remained minimal, which might suggest a visible risk of rising inflation.

Consequently, the ringgit could potentially perform well today, oscillating around RM4.07 to RM4.09 against the US dollar, Dr Rashid said. The local currency started the day stronger across a basket of major currencies, with gains against the Japanese yen, euro, and British pound. However, it weakened against the Singapore dollar. The ringgit remained stable against the Indonesian rupiah and unchanged versus the Philippine peso.