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Friday, September 18th, 2020

Prospect of US interest rates hike weighs on ringgit

by November 18, 2016 General

KUALA LUMPUR, Nov 18 — The ringgit lost further ground against the US dollar today on growing concerns over the US interest rates hike next month, bolstered by the country’s encouraging economic data, a dealer said.

At 6pm, the local unit was traded at 4.4140/4190 against the greenback from 4.3900/3970 yesterday.

At 10am, the ringgit declined and touched the 4.4030 mark against the greenback in response to the US Federal Reserve (Fed) Chair Janet Yellen’s remark yesterday, signalling that the interest rate may rise soon.

FXTM Vice President of Market Research, Jameel Ahmad, said the probability of the Fed raising US interest rates next month had reached near the 90 per cent level.

He said Yellen stated overnight that the US interest rates would be raised “relatively soon” and investors had taken the news as further encouragement that the central bank will be pulling the trigger in December, which has supported buying sentiment for the dollar.

On the home front, Bank Negara Malaysia has taken measures to stem the volatility in the foreign exchange market and it reiterated that the onshore rate of the currency is the right reference price.

The local unit was traded slightly higher against other major currencies.

It was higher against the Singapore dollar to 3.0962/0008 from 3.0988/0063 yesterday and declined against the British pound to 5.4734/4813 from 5.4717/4857 yesterday.

The ringgit rose against the yen to 3.9874/9948 from yesterday’s 4.0216/0314 and appreciated against the euro to 4.6780/6837 from 4.7070/7158 previously. — Bernama