kuala lumpur: Amid cautious market sentiment ahead of the possibility of a gradual U.S. tariff increase and the release of the U.S. Producer Price Index (PPI) and Consumer Price Index (CPI) scheduled for later this week, this morning’s The ringgit opened slightly higher against the US dollar.
As of 8am, the ringgit was trading at 4.4925/5050 ringgit against the US dollar, compared with yesterday’s closing price of 4.5080/5120 ringgit.
Muamarat Bank Malaysia Chief Economist Dr Mohd Afzanizam Abdul Rashid said the US Dollar Index (DXY) continued to rise at 109.956 points after reaching 110.163 points last night, adding that the Federal Reserve is trying to curb inflation. This was the highest since November 2022, when the policy interest rate was raised.
President-elect Donald Trump’s economic team is reportedly considering raising tariffs by 2% to 5% a month in stages under the International Emergency Economic Powers Act.
This approach aims to increase negotiating leverage while minimizing inflation risk.
Against this backdrop, the ringgit is likely to remain within a narrow range of RM4.50 to RM4.51.
“The market is cautious about this week’s US PPI and CPI data as the consensus is for the headline PPI in December 2024 to be 3.4%, up from the previous 3.0%,” he told Bernama. This will be another reason to continue.”
Mohd Afzanizam also pointed out that December’s CPI will be 2.9%, higher than the previous month’s 2.7%.
“The U.S. Federal Reserve is likely to leave the federal funds rate unchanged at the January 28-29 Federal Open Market Committee meeting.
Meanwhile, the ringgit started almost depreciating against major currencies.
Against the Japanese yen, the yen appreciated from yesterday’s closing price of 2.8706/8733 to 2.8555/8636, but against the euro it fell from 4.5964/6004 to 4.6107/6235, and against the British pound it fell from Monday’s closing price to 5.4943/5096. 5.4592/4640.
Local banknotes traded mixed against ASEAN currencies.
The ringgit further appreciated against the Philippine peso to 7.65/7.68 from 7.68/7.69, and against the Indonesian rupiah it was higher at 275.8/276.8 from yesterday’s closing price of 276.8/277.2.
Against the Thai baht, it fell to 12.9486/9947 from 12.9440/9618, and against the Singapore dollar, it fell to 3.2830/2926 from the previous day’s closing price of 3.2788/2822.
