KUALA LUMPUR, July 26 — The ringgit ended lower against the US dollar today ahead of the United States (US) Federal Open Market Committee (FOMC) meeting this week, coupled with concerns over the high number of daily Covid-19 cases in Malaysia in recent days, an analyst said.
At 6pm, the local note depreciated by 45 basis points to 4.2300/2320 versus the greenback from Friday’s close of 4.2255/2275.
According to Kenanga Research, the local note declined as the market factored in the possibility that the US Federal Reserve may start to tiptoe towards tapering its bond purchases.
“Looking beyond the near-term Covid-induced US dollar strength and Malaysia’s worsening health crisis, the local note may be supported by a better-than-expected trade figures and a potential easing of the Covid-19 restrictions for fully vaccinated people,” it said in a note today.
The new Covid-19 cases reported in Malaysia dropped to 14,516 today, following a record high of 17,045 cases yesterday, bringing the cumulative number of cases to 1,027,954.
However, Bank Islam Malaysia Bhd economist Adam Mohamed said the drop in daily cases was not enough to spur positivity in the market and the pandemic continued to cloud sentiment.
“Aside from that, lower Brent crude oil prices which has a causality effect on the ringgit too prevented the local note from strengthening as the increasing cases of Covid-19 worldwide dampen oil demand outlook,” he told Bernama.
At press time, the benchmark Brent crude oil fell by 0.28 per cent to US$73.89 per barrel.
Meanwhile, at the close, the local note was traded lower against a basket of major currencies.
The ringgit depreciated against the euro to 4.9901/9925 from Friday’s close of 4.9781/9834, fell versus the Japanese yen to 3.8350/8372 from 3.8254/8275, declined against the Singapore dollar to 3.1108/1127 from 3.1070/1089 and weakened against the British pound to 5.8349/8376 from 5.8054/8082 previously. — Bernama