kuala lumpur: Ringgits were bolstered against the US dollar in trading earlier on Thursday. This was supported by improved purchases of sentiment in the domestic currency despite the stiffer US dollar index (DXY).
At 8:02am, Ringgit advanced to 4.4150/4305 against the greenback from the end of 4.4260/4300 on Wednesday.
Bank Mohmarat Malaysia BHD Chief Economist Dr Mohd Afzanizam Abdul Rashid said DXY had an edge of up to 103.584 but remained relatively low.
“That memo could have a positive ripple effect on emerging market currencies, including Ringgit, which could remain around RM4.41 to RM4.42 today,” he told Bernama.
He said the outlook is supported by recent economic data, particularly lower than expected US Consumer Price Index (CPI) printing, which is a consensus estimate of 2.9% in February, at 2.8%.
Similarly, Core CPI rose 3.1%, below the market forecast of 3.2%.
“The latest inflation data hopes that the US Federal Reserve will tend to ease monetary policy to stabilize the economy.
“However, the ongoing tariff war is expected to boost business costs. Consumer and business sentiment can strain spending and cause growth,” he added.
Mohd Afzanizam said the focus will be on the Federal Open Market Committee meeting from March 18-19.
“The market will scrutinise the dot plot and assess whether it will adopt FED fund rate forecasts to match the expectations of three or four rate reductions this year.
“As such, attention is likely to dominate the currency market,” he added.
The ringgits have been bolstered against a basket of major currencies.
It rose to 2.9767/9875 against the Japanese yen from 2.9775/9804 on Wednesday to 2.9767/9875 against the Japanese yen, up from 5.7255/7306 to 5.7236/7437 against the British pound, and won against the euro from 4.8057/8226.
Local currency traded mostly high against ASEAN currency.
It went on to 3.3138/3257 against the Singapore Dollar from the closure on Wednesday at 3.3181/3213, and rose to 268.3/269.4 against the Indonesian Rupiah from 269.0/269.3, and rose to 7.69/7.73 against the Philippine Peso from 7.71/7.73.
However, the ringgits had previously fallen below the bottom from 13.0688/0868 against the Thai baht from 13.0695/1235.
