KUALA LUMPUR, March 21 — The ringgit climbed to an eight-month high today against the US dollar after the US Federal Reserves indicated it will not raise interest rates this year.
As of 9am, the local currency stood at 4.0540/0580 against the greenback compared with yesterday’s close of 4.0650/0690.
Maybank Kim Eng research said the signal of a long pause on interest rates hikes by the US Federal Reserve has weakened the dollar as the move indicates the risks to their outlook, even as the domestic economy moves at a slower pace.
The Federal Reserve chairman Jerome Powell reportedly said that the interest rates could be on hold for “some time” as global risks weigh on the economic outlook while inflation remains muted.
Another dealer said, besides the dovish monetary stance adopted by the Fed’s, the troubled trade talk between the US and China has also put a dent on the dollar as well as yuan’s performance.
“US President Donald Trump said he’ll keep tariffs on China until he’s sure Beijing is complying with any trade deal, refuting expectations that the two nations will agree to roll back duties as part of a lasting truce to their trade tension,” he said to Bernama.
At the local front, he said the increase in the overnight price of benchmark Brent crude to US$68.20 as of 9 am has also boosted the local note performance.
Meanwhile, the ringgit was also traded lower against a basket of other major currencies.
It decreased against the Japanese yen to 3.6618/6664 from 3.6441/6487 and slid versus the euro to 4.6329/6379 from 4.6130/6187 yesterday.
The ringgit however appreciated versus the British pound to 5.3574/3643 from 5.3756/3829 but dipped against the Singapore dollar to 3.0101/0149 from 3.0080/0121 yesterday. — Bernama
