KUALA LUMPUR, April 25 — The ringgit fell against the US dollar at Thursday’s close, nearing the bottom of the weekly range after the country’s Consumer Price Index (CPI) nudged into positive territory, as traders mildly pared back dovish bets on Bank Negara, dealers said.
On Wednesday, the Department of Statistics released its data for March 2019, which saw inflation rate, as measured by the CPI, increase by 0.2 per cent to 121.1 from 120.9 a year earlier.
At 6 pm, the ringgit stood at 4.1340/1380 versus the greenback from 4.1250/1300 recorded at Wednesday’s close.
SPI Asset Management managing partner and head of trading, Stephen Innes, said the trading of the local note was less sensitive to surging oil prices as markets were focusing on the costs from higher subsidies possibly exceeding the benefits from more significant energy revenues.
He noted two points in the 2019 Budget: oil was bullishly factored in at US$70 per barrel and fuel subsidy was budgeted in at RM2 billion.
“With oil prices surging, without a massive overhaul to the subsidy programme, the current levels of subsidies could put a severe dent in the government coffers projections. And frankly, higher oil prices may only delay the inevitable evaporation of Malaysia’s current account surplus. Definitely a negative for the ringgit,” Innes said.
Meanwhile, the ringgit was traded mostly higher against other major currencies.
It rose against the Singapore dollar to 3.0288/0328 from 3.0351/0392 on Wednesday and appreciated versus the British pound to 5.3200/3268 from 5.3365/3446.
The local currency weakened vis-a-vis the yen to 3.6940/6986 from 3.6870/6921 but improved against the euro to 4.6020/6077 from 4.6254/6326. — Bernama
