KUALA LUMPUR, Aug 5 — The ringgit continued to close higher against the United States (US) dollar as expectations of an interest rate cut by the US Federal Reserve (US Fed) gained momentum.
At 6pm, the local note climbed to 4.2260/2310 against the greenback from Monday’s close of 4.2350/2385.
Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said that risky assets like equities have been rising as a lower interest environment would be positive for corporate finances, especially on their cost of borrowings.
He noted that a series of US Fed speakers are expected to shed more light on the future direction of US interest rates.
Several US Fed officials, including San Francisco US Fed President Mary Daly, Boston US Fed President Susan Collins, and US Fed Governor Lisa Cook, will be speaking to the public on Thursday.
“Our sense is that the market would want to hear the latest conviction among the US Fed as to how the interest rate would evolve in the months to come, especially in the September Federal Open Market Committee meeting,” Afzanizam told Bernama.
At the close, the ringgit ended firmer against major currencies.
It rose against the Japanese yen to 2.8618/8654 from 2.8652/8677 at the close on Monday, gained versus the British pound to 5.6159/6226 from 5.6296/6342, and was higher against the euro to 4.8772/8830 from 4.8978/9018 previously.
The ringgit was also strengthened against regional peers.
It improved against the Singapore dollar to 3.2793/2834 from 3.2878/2908, inched up versus the Thai baht to 13.0408/0627 from 13.0452/0616, strengthened against the Indonesian rupiah to 257.8/258.2 from 258.2/258.5 and improved against the Philippine peso to 7.33/7.34 from 7.38/7.39 previously.
