Ringgit lower on bullish sentiment over US dollar

KUALA LUMPUR: The ringgit continued its downtrend to end lower against the greenback yesterday due to continued positive sentiment for the US dollar, which was bolstered by strong US March retail sales data and amid concerns over the Middle East tension, said an analyst.

At 6pm, the ringgit fell to 4.7945/7970 against the US dollar from Monday’s closing of 4.7785/7815.

Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the strong US retail sales data suggest that the anticipation of a US rate cut has diminished.

“This certainly has led to higher demand for the US dollar which saw the US Dollar Index rose 0.16% to 106.373 points,” he told Bernama.

He also noted that concerns over Middle East tensions would exert pressure on emerging market currencies as demand for safe haven currencies such as the US dollar is higher.

At the close, the ringgit was traded mostly lower against a basket of major currencies.

It shed against the euro to 5.0966/0992 from 5.0915/0947 at Monday’s close, weakened versus the British pound to 5.9701/9732 from 5.9660/9697 but was better vis-a-vis the Japanese yen to 3.1020/1038 from 3.1053/1075 yesterday.

However, the ringgit was traded mixed against Asean currencies. It was lower versus the Thai baht at 13.0858/13.0983 compared with 13.0148/13.0286 at Monday’s close, depreciated against the Singapore dollar to 3.5135/5156 from 3.5123/5148 yesterday, but was flat versus the Philippine peso at 8.41/8.42 and stronger vis-a-vis the Indonesian rupiah to 296.3/296.6 from 301.4/301.8 previously.