Ringgit ends higher against greenback on Fed rate outlook
The local currency gained momentum as recent US data suggested the Fed might skip a rate hike next month, says analyst.
KUALA LUMPUR: By the close of business on Wednesday, the Malaysian ringgit had risen marginally against the US dollar, buoyed by expectations that the Federal Reserve may postpone a rate hike following disappointing consumer sentiment data. At 6pm, the ringgit climbed to 4.0785/4.0820 against the greenback, up from its previous close of 4.0790/4.0850.
Afzanizam Rashid, chief economist at Bank Muamalat Malaysia Bhd, attributed the ringgit's gain to recent US economic indicators, suggesting the Fed might postpone its decision on interest rates. He noted that weaker consumer sentiment could dampen household spending, which constitutes around two-thirds of the US economy. Market participants would be watching the ADP employment and Personal Consumption Expenditures (PCE) reports due later that night.
Afzanizam stated that expectations for an increase in ADP employment to 73,000 in September, up from 38,000 in August, and sustained PCE inflation at 3.7% might prompt a further correction in the US dollar in the near term. At the close, the ringgit traded weaker against a basket of major currencies, including the euro, British pound, and Japanese yen.
However, it performed better against Asian currencies like the Singapore dollar, Thai baht, and Indonesian rupiah.
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.
Also reported by 2 other outlets
- Ringgit ends higher against greenback on Fed rate outlook freemalaysiatoday.com
- Ringgit ends slightly higher against greenback on Fed rate outlook nst.com.my
