Ringgit slips marginally as overbought correction sets in

KUALA LUMPUR: The ringgit took a breather against the US dollar today following almost a week-long gain.

At 9.01 am, the ringgit slipped to 4.6810/6845 against the greenback from Tuesday’s close of 4.6765/6800.

Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid reckoned that the ringgit is already in the overbought position, indicating further appreciation in the near term looks somewhat limited.

This was despite the US dollar Index (DXY) falling to 102.86 points and risk-on mode has yet to be interrupted although the US consumer price index (CPI) was higher than market expectations.

Inflation in the US, as measured by the change in the Consumer Price Index (CPI), expanded to 3.2 per cent in February compared to the projected 3.1 per cent.

Annual Core CPI, which excludes volatile food and energy prices, also came in higher than expected, increasing 3.8 per cent last month.

On top of that, he added that market participants are set to be on alert mode ahead of the impending US Federal Open Market Committee (FOMC) meeting next week.

“On that note, the US dollar/ringgit pair would continue to linger around 4.67 to 4.68,” he told BK.

Concurrently, the ringgit was traded lower against a basket of major currencies.

The local currency was easier against the British pound at 5.9893/5.9938 from 5.9808/9853 on Tuesday, depreciated vis-a-vis the Japanese yen to 3.1770/1796 from 3.1718/1744, and was weaker versus the euro at 5.1149/1188 from 5.1114/1152 previously.

The local note traded mixed against other Asean currencies.

It rose versus the Thai baht to 13.1054/1204 versus 13.1436/1601 yesterday and was unchanged against the Philippine peso at 8.45/8.47.

The ringgit was lower against the Singapore dollar to 3.5145/5174 from Tuesday’s close of 3.5133/5162 and decreased vis-a-vis the Indonesian rupiah to 300.2/300.6 from 299.9/300.3 previously. – BK