Ringgit ends lower ahead of Jackson Hole symposium
Traders will scrutinise US Federal Reserve chair Kevin Warsh’s Jackson Hole speech tomorrow for clues on the Fed’s next Federal Open Market Committee decision, says analyst.
KUALA LUMPUR: The Malaysian ringgit closed lower against the US dollar due to cautious market sentiment ahead of the US Federal Reserve’s Jackson Hole symposium. Economist Afzanizam Abdul Rashid of Bank Muamalat Malaysia Bhd stated that traders will be closely examining US Fed chair Kevin Warsh’s speech at the upcoming symposium, scheduled for Aug 28, for insights into potential Fed actions at the September FOMC meeting.
He also mentioned the rising US government debt and Treasury yields, which would raise debt servicing costs. The ringgit is expected to remain stable at the current 3.50%-3.75% Federal Funds Rate level, according to Rashid. The Jackson Hole symposium, held Aug 27-29, is scrutinised as it may provide early hints on the Fed’s next move on interest rates.
A hint of a rate cut could weaken the US dollar, benefiting the ringgit. Quintex Intel global strategist Stephen Innes noted that traders would be particularly focused on Warsh’s speech at 10 am ET on Friday, as the tone of his remarks would likely determine whether the US dollar continues its recent climb or loses momentum. The ringgit's slight decline was attributed to a slightly stronger-than-expected US core inflation reading, which reignited expectations of a potential Fed rate hike in December.
The local currency rose against several currencies, including the Japanese yen, British pound, and euro, but slipped against the Singapore dollar, Indonesian rupiah, and Thai baht.
Written by urgent.news from Free Malaysia Today's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
