Ringgit firmer against US dollar ahead of CPI data

KUALA LUMPUR – The Malaysian ringgit finished slightly higher against the US dollar despite soaring oil prices and speculation of an upcoming interest rate increase, as traders kept an eye on the upcoming release of the US Consumer Price Index (CPI) data on Friday. Afzanizam Abdul Rashid, the chief economist of Bank Muamalat Malaysia Bhd, pointed out that Brent crude oil was trading around US$101 (RM410.63) per barrel, which could support the case for a rate hike at the Federal Open Market Committee meeting next week.

Despite this, the ringgit managed to perform well against the US dollar. However, it remains uncertain whether this appreciation can be maintained in the short term. Afzanizam emphasized that the US inflation data due on Friday would be crucial in determining the Federal Reserve's policy direction, which in turn could impact the ringgit's near-term performance.

At 6pm, the local currency rose to 4.0630/4.0670 against the US dollar from yesterday's close of 4.0670/4.0720. Throughout the day, the ringgit traded stronger against several major currencies, including the euro, Japanese yen, British pound, and Singapore dollar.