KUALA LUMPUR, Oct 25 — The ringgit ended the week on a lower note against the US dollar today in cautious trading ahead of the US Federal Open Market Committee (FOMC) meeting on Tuesday next week, dealers said.
At 6pm, the ringgit was quoted at 4.1845/1875 versus the greenback from 4.1830/1870 at Thursday’s close.
FXTM market analyst Han Tan said this week’s ringgit performance marked its fourth consecutive week of moving within the 4.18-4.20 level range.
On the local front, he said Malaysia’s September Consumer Price Index (CPI) reading during the week caused little sway on the ringgit, as the data maintained the narrative that the domestic inflationary pressures remain manageable.
The Department of Statistics Malaysia on Wednesday said CPI increased 1.1 per cent in September 2019 to 121.8 from 120.5 in the same month of the preceding year.
Meanwhile, Han Tan said it is important to note that a stable currency facilitates economic activities such as external trade, and a trade-weighted gauge of the ringgit versus global currencies has been fairly steady since 2018.
He said a much stronger currency may not be in Malaysia’s best interests given the current global economic climate.
“Consider Thailand, where policymakers are actively trying to rein in the baht’s strength, has been blamed for curtailing its economic growth.
“Extraneous factors will continue to serve as the ringgit’s primary drivers, with the US-China trade conflict having the biggest say on global risk sentiment,” he told Bernama.
Additionally, the market expects the US Federal Reserve to lower interest rates at its next FOMC meeting, which would dictate the US dollar movement and subsequently would have a bearing on the ringgit performance.
Meanwhile, the local note was traded mixed against other major currencies.
The ringgit fell against the Singapore dollar to 3.0692/0725 from 3.0676/0714 and declined against the yen to 3.8508/8555 from 3.8482/8533.
It rose against the British pound to 5.3716/3768 from 5.3890/3945 and improved against the euro to 4.6502/6552 from 4.6553/6614. — Bernama
