Ringgit slips versus US dollar on expectation of further US rate hike

Ringgit slips versus US dollar on expectation of further US rate hike

The ringgit weakened further against the US dollar today as the greenback remained firm on expectation of more aggressive United States (US) rate hike in the coming months following the Federal Reserve (Fed) officials’ hawkish statements. ― Picture by Hari Anggara

Thursday, 04 Aug 2022 6:46 PM MYT

KUALA LUMPUR, Aug 4 — The ringgit weakened further against the US dollar today as the greenback remained firm on expectation of more aggressive United States (US) rate hike in the coming months following the Federal Reserve (Fed) officials’ hawkish statements.

The US dollar continued to be supported after Fed officials seemed to oppose the perception that they will slow the pace of interest rate hike as the interest rates were close to peaking, dealers said.

At 6pm, the local currency eased to 4.4565/4590 versus the greenback from yesterday’s close of 4.4550/4565 SPI Asset Management managing partner Stephen Innes said even though local risk sentiment is sailing on an even keel with no material evidence of China-Taiwan tension escalation on Thursday with Bursa Malaysia index closing higher, it was out of the fire and back into the frying pan for the ringgit.

“Even if investors would start to shift attention away from the geopolitical event, concerns about China’s domestic economy are overshadowing risk. China continues to politicalise Covid controls, which is weighing on the ringgit,” he told Bernama.

Meanwhile, the ringgit also closed lower against a basket of major currencies, except the Japanese yen.

The local currency eased against the euro to 4.5398/5424 from 4.5396/5412 on Wednesday and fell versus the British pound to 5.4271/4302 from 5.4244/4262 previously.

It also slipped against the Singapore dollar to 3.2310/2333 from yesterday’s close of 3.2262/2277 but appreciated vis-a-vis the Japanese yen to 3.3228/3251from 3.3459/3472 yesterday. — Bernama