KUALA LUMPUR, Feb 20 — The ringgit continued to lose ground against the firming US dollar following positive data in the US housing market and a steady Federal Open Market Committee (FOMC) meeting minutes.
At 6pm, the local note lost 200 basis points (bps) to 4.1800/1840 against the greenback from yesterday’s close of 4.1600/1620.
This is the lowest level last seen on Nov 26, 2019 when the local unit finished at 4.1810/1850 versus the US dollar.
In a note today, Oanda senior market analyst for Asia Pacific Jeffrey Halley said the US dollar had made steady progress against regional currencies.
Meanwhile, AxiCorp’s chief market strategist Stephen Innes said the mounting economic concerns from China, coupled with Japan’s recession fears, had weighed on the ringgit’s performance.
“The slower growth in China will have a broad-based impact on Asean economies, including Malaysia, as supply chain disruptions affected exports while commodity dislocations weighed on inflation.
“And now with Japan teetering on the cliff edge of recession, it suggests demand for safe-havens rather than riskier Asean assets will likely be the name of the game over the short term, at least,” he told Bernama.
Innes also added that the ringgit’s fall was also tracking the weakening Chinese yuan, as traders sold the ringgit lower due to the correlation factor.
At the close, the ringgit was traded mostly higher against other major currencies, except against the euro.
It rose against the Singapore dollar to 2.9849/9894 from 2.9885/9910 yesterday, increased against the pound to 5.3926/3990 from 5.4101/4143, and strengthened against the yen to 3.7328/7367 from 3.7729/7761.
Vis-a-vis the euro, the local note retreated to 4.5140/5191 from 4.4932/4970 yesterday. — Bernama
